On Thursday, Stifel reiterated its Buy rating on RxSight Inc. (NASDAQ: RXST) stock with a steady price target of $65.00. The firm's position followed RxSight's unexpected acceleration in Light Adjustable Lens (LAL) utilization in the second quarter of 2024, which surpassed initial expectations. The early uptick in LAL usage has led to a forecast of continued year-over-year growth into the third quarter.
The analyst from Stifel highlighted that the second quarter performance had dispelled their previous concerns about investor optimism, as the actual utilization inflection occurred much sooner than anticipated. With the third quarter of 2024 expected to show further improvements, Stifel anticipates RxSight will surpass sales estimates, predicting a robust beat with sales ranging between $37 million and $38 million.
While the report is not an earnings call prediction, it reflects a positive outlook for RxSight's near-term performance. Stifel's analysis suggests good risk-reward for the company's shares, which are currently trading below $50, over an intermediate term of 6 to 9 months or more. The firm's long-term confidence in RxSight remains strong, considering the company as one of the top share-gain stories in the medical technology sector.
The analyst's commentary was informed by a July 2024 survey and subsequent data analysis. The report outlines both the positive aspects and potential challenges that could affect the stock's performance. However, Stifel advises a more balanced and tactical approach to investing in RxSight shares if they reach the $60 to $65 range over the next year.
In other recent news, RxSight Inc. has reported a significant 68% increase in revenue for the second quarter of 2024, reaching $34.9 million. This substantial growth has been largely attributed to the successful sales of their Light Adjustable Lens (LAL) units and Light Delivery Devices (LDDs). Encouraged by this growth, RxSight has increased its full-year revenue guidance for 2024.
BTIG and Needham, two prominent analyst firms, have maintained their Buy ratings on RxSight's stock, reflecting their confidence in the company's growth trajectory. Both firms anticipate a significant contribution from RxSight's domestic market penetration and international commercial efforts, expected to materialize in 2025.
In addition to these developments, RxSight has achieved FDA approval for an extension of the spherical refractive power range for the LAL+, which is expected to enhance commercial distribution by the end of 2024. Furthermore, despite the complexities of different European markets, RxSight is committed to expanding its international regulatory approvals. These are some of the recent developments surrounding RxSight Inc.
InvestingPro Insights
RxSight's recent performance aligns with several key metrics and insights from InvestingPro. The company's revenue growth is particularly noteworthy, with a 71.9% increase over the last twelve months as of Q2 2024, and a 67.65% quarterly growth in Q2 2024. This robust growth supports Stifel's optimistic outlook and expectations for continued strong performance.
An InvestingPro Tip highlights that RxSight has shown a "High return over the last year," which is quantified by the impressive 82.99% one-year price total return. This substantial return aligns with Stifel's positive stance on the company's potential as a top share-gain story in the medical technology sector.
However, investors should note that RxSight is currently "Not profitable over the last twelve months," according to another InvestingPro Tip. This is reflected in the negative operating income of -$42.37 million and a negative EBITDA of -$38.31 million for the last twelve months as of Q2 2024. Despite this, the company's strong revenue growth and market position suggest potential for future profitability.
For readers interested in a more comprehensive analysis, InvestingPro offers 5 additional tips and a range of financial metrics to further evaluate RxSight's investment potential.
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