On Friday, Stephens raised the stock price target for Vericel (NASDAQ:VCEL) Corporation (NASDAQ:VCEL) to $58 from the previous target of $56, while maintaining an Overweight rating on the stock. This adjustment follows Vericel's second quarter financial results, which showed a marginal revenue outperformance and a positive revision in the company's full-year guidance.
Vericel reported second-quarter revenue of $52.7 million, narrowly surpassing the consensus estimate of $52.6 million. This was attributed to a better-than-expected performance from its MACI product, which exceeded projections by $1.6 million or 4%.
However, this was partly offset by a shortfall in Epicel revenue, which missed expectations by the same amount, representing a 17% deviation from consensus. NexoBrid, another product in the company's portfolio, also exceeded revenue expectations by $0.1 million.
The company's gross margins for the quarter stood at 69.5%, which was higher than the consensus prediction of 68.5%. Despite this, Vericel's adjusted EBITDA margins came in at 12.0%, falling short of the expected 13.5%.
Looking forward, Vericel has reaffirmed its revenue guidance for the year 2024, projecting between $238 million and $242 million, in line with the consensus estimate of $240.3 million. Notably, the company has increased its growth expectations for MACI to over 20% from the previous high-teens estimate. Furthermore, Vericel has raised its gross margin forecast to 71% from 70% and adjusted its EBITDA margin outlook to 21% from the earlier 20%.
The analyst from Stephens concluded that the quarter's results were seen positively despite fluctuations in the burn care business segment. The revised price target reflects the firm's optimism about Vericel's financial performance and outlook.
In other recent news, Vericel Corporation has demonstrated a strong financial performance in the first quarter of 2024, with total revenue exceeding $51 million, marking a 25% increase from the previous year. The robust revenue growth is attributed to the company's MACI and Burn Care franchises, which saw revenues rise by 18% and over 60% respectively. In light of this, Vericel has revised its full-year revenue guidance upward to between $238 million and $242 million.
In addition to its impressive financial performance, Vericel has received a positive outlook from TD Cowen, which initiated coverage with a buy rating, pointing to the company's robust revenue growth and achievement of EBITDA profitability. The firm's analysis also highlighted Vericel's strong product pipeline and upcoming product introductions as key drivers for future growth.
Furthermore, Vericel plans to expand its sales force to support new product launches and increase market penetration. The company expects most target centers to be ready to use NexoBrid, one of its key products, by the end of 2024. These recent developments suggest Vericel's commitment to expansion and profitability, setting the stage for the company's continued growth trajectory.
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