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On Tuesday, Needham analysts adjusted their outlook on Artivion Inc. (NYSE: AORT), reducing the price target to $32.00 from the previous $34.00 while maintaining a Buy rating on the company’s shares. Currently trading at $27.85, Artivion has shown strong momentum with a 37.4% return over the past year, despite recent mixed results. According to InvestingPro data, the stock appears overvalued at current levels, with analysts maintaining price targets between $30 and $35.
Artivion reported that their fourth-quarter revenue for 2024 fell short of market expectations, although EBITDA (earnings before interest, taxes, depreciation, and amortization) surpassed consensus. While the company maintains a healthy gross profit margin of 64.5%, InvestingPro analysis reveals the company trades at a relatively high EV/EBITDA multiple of 28x. The company’s revenue guidance for 2025 was slightly below the consensus midpoint, but its EBITDA forecast was more optimistic, coming in above the midpoint that analysts had anticipated.
The slowdown in constant currency revenue growth was notable, decreasing to 3.5% in the fourth quarter of 2024 from 9.5% in the third quarter. This deceleration was attributed to a cybersecurity issue previously disclosed by the company, which disrupted sales operations. In addition, Artivion experienced a year-over-year decline in gross margin by 200 basis points, though its EBITDA margin improved by 170 basis points.
Breaking down Artivion’s product performance, the On-X line saw a 10% increase in constant currency terms, stent grafts rose by 8%, and BioGlue sales increased by 7%. However, Preservation Services experienced an 8% decline. From a geographical standpoint, the company witnessed significant growth in Latin America at 26% in constant currency terms, while both the Asia Pacific and EMEA regions grew by 7%.
Despite the fourth quarter of 2024 being marred by disappointment, mainly due to the cybersecurity incident, analysts at Needham anticipate a robust recovery for Artivion throughout the remainder of 2025. InvestingPro data shows the company maintains a "GOOD" overall financial health score, with analysts expecting profitability this year. The lowered price target to $32 reflects concerns over the impact of the cybersecurity issue, particularly its expected continued effect on the first quarter of 2025. For deeper insights into Artivion’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Artivion Inc. reported its Q4 2024 earnings with revenues of $97.3 million, falling short of the forecasted $100.82 million. This revenue miss was attributed to a cybersecurity incident that impacted operations, causing a $4.5 million shortfall. Despite this, Artivion achieved a 3% year-over-year revenue growth, with notable performance in Latin America and Asia Pacific markets. The company’s full-year 2024 revenues reached $388.5 million, marking a 9.4% growth in constant currency. JMP Securities maintained its Market Outperform rating for Artivion, keeping the stock’s target price at $33.00, despite the operational disruptions caused by the cyberattack.
Management has indicated that operations have returned to normal, though the tissue processing division experienced an 8% decline due to the incident. Artivion projects 2025 revenue to be between $420 million and $435 million, representing a 10-14% growth. The company anticipates adjusted EBITDA to reach between $84 million and $91 million. Analyst firms like JMP Securities remain optimistic about Artivion’s recovery and future performance, emphasizing product innovations such as the AMDS device as key growth drivers. Artivion’s focus on recovering from the disruption and offsetting the first quarter’s challenges remains a priority for the company.
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