On Wednesday, Truist Securities revised its price target for RadNet (NASDAQ: RDNT) shares, a leading provider of diagnostic imaging services, increasing it to $63.00 from the previous $55.00. The firm has also reaffirmed its Buy rating for the company's stock.
The adjustment came after RadNet reported its first quarter results and provided an updated full-year 2024 guidance. In response to these developments, Truist Securities has raised its adjusted EBITDA forecasts for RadNet for the years 2024 and 2025 to $272 million and $294 million, respectively. This represents an increase from the prior estimates of $266 million and $288 million.
The firm's decision to raise the price target is based on a slightly higher assumed multiple derived from the increased EBITDA estimates. The analyst at Truist Securities expressed confidence in the company by stating, "We have adjusted our estimates to reflect 1Q results and increased FY24 guidance, raising our 2024 - 2025 adjusted EBITDA estimates to $272M and $294M (vs. prior $266M and $288M, respectively)."
The analyst also reiterated their positive stance on RadNet's stock, emphasizing the rationale behind the updated price target. "We reiterate our Buy rating and are raising our price target to $63 (vs. prior $55) to reflect a modestly higher assumed multiple off of our raised estimates," the analyst noted.
RadNet operates a network of outpatient imaging centers and is known for its use of advanced imaging technologies. The company's increased guidance suggests a positive outlook for its operational performance in the upcoming years.
InvestingPro Insights
Following the revised price target and buy rating from Truist Securities, RadNet (NASDAQ: RDNT) continues to be a focal point for investors. With a market capitalization of $4.19 billion and a significant 104.73% return over the last year, RadNet's financial health and stock performance are under the spotlight. The company's revenue growth is robust, with a 12.1% increase over the last twelve months as of Q1 2024, and a quarterly revenue growth of 10.53% in Q1 2024. This aligns with the positive outlook expressed by Truist Securities regarding the company's performance.
InvestingPro Tips reveal that analysts expect net income growth this year for RadNet, and two analysts have revised their earnings upwards for the upcoming period, indicating potential optimism in the financial community. Additionally, RadNet's stock has shown a strong return over the last three months, with a price total return of 47.08%. However, it's important to note that the stock is trading near its 52-week high, with the price at 99.91% of this peak, which could suggest a need for caution among investors.
For those interested in a deeper dive into RadNet's performance and prospects, there are 18 additional InvestingPro Tips available at InvestingPro. And for a limited time, readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, providing access to even more expert analysis and data to inform investment decisions.
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