BTIG maintains Buy on Delcath stock with $23 target

Thursday, BTIG analysts reiterated their Buy rating on Delcath Systems (NASDAQ:DCTH) with a maintained price target of $23.00, which aligns with the broader analyst consensus. According to InvestingPro data, analyst targets range from $21 to $25, suggesting significant upside potential from current levels. The endorsement followed Delcath Systems’ announcement of its full-year 2025 guidance and its decision to join the Medicaid National Drug Rebate Agreement Program (NDRA). The company forecasts total revenue for the year to be between $94 million and $98 million, marking a 158% year-over-year increase, which aligns with the consensus estimate of $94.1 million. This projection follows the company’s impressive revenue growth of over 1,000% in the last twelve months. Additionally, Delcath anticipates gross margins in the range of 83-85%, slightly below the consensus of 86% but consistent with their current gross margin of 84.9%, and expects to achieve positive adjusted EBITDA and cash flow in each quarter of the year, surpassing the consensus adjusted EBITDA projection of $25.6 million.

The company also projected a significant increase in the total volume of Hepzato treatments, expecting at least a 200% rise compared to 2024. This is a more optimistic estimate than BTIG’s previously modeled 157% year-over-year increase. Delcath’s participation in the NDRA program aims to broaden patient access by offering rebates and 340B discounts to eligible hospitals, which may impact revenue per treatment but could also act as a catalyst for higher treatment volumes.

Delcath has begun the process to implement the NDRA program with the Centers for Medicare & Medicaid Services (CMS) and anticipates the program to be operational at the start of the third quarter of 2025. Company management has confirmed that their earlier guidance on the ramp-up of active sites remains unchanged, though they have expressed increased confidence in achieving these targets.

In light of this new information, BTIG analysts have updated their model for Delcath Systems and reiterated their positive stance on the stock with a $23 price target. The company maintains a strong financial position with a current ratio of 15.95, indicating robust liquidity. InvestingPro analysis reveals 12 additional key insights about Delcath’s financial health and market position, available through the comprehensive Pro Research Report.

In other recent news, Delcath Systems has reported a strong start to 2025, surpassing first-quarter earnings expectations with an earnings per share of $0.03, beating the forecast of $0.02. The company also exceeded revenue projections, posting $19.8 million against the expected $15.51 million. This performance reflects Delcath’s successful operational strategies and market expansion efforts, with net income reaching $1.1 million, a significant turnaround from a $11.1 million loss the previous year. Gross margins improved to 86%, up from 71% in 2024, indicating enhanced operational efficiency.

Additionally, Delcath forecasts a revenue increase for fiscal year 2025, projecting between $94 to $98 million, and plans to participate in the Medicaid National Drug Rebate Agreement. This move aims to simplify Medicaid access and enhance the availability of their HEPZATO treatment in the U.S. Analysts from Clear Street have raised their price target for Delcath Systems from $22.00 to $26.00, maintaining a Buy rating, citing strong commercial performance and the company’s ability to exceed financial estimates. The analysts highlighted the expansion of treatment sites and a growing referral network as key factors for Delcath’s sustained progress.

Delcath’s strategic initiatives and the anticipated growth trajectory of their liver cancer treatment, Hepzato, have been recognized as positive indicators for the company’s future financial performance.

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