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Investing.com - Evercore ISI initiated coverage on iRhythm Technologies (NASDAQ:IRTC) with an In Line rating and a $185.00 price target. The stock, currently trading near its 52-week high of $187.57, has delivered an impressive 104.87% return year-to-date, according to InvestingPro data.
The research firm highlighted the strong execution by new management, noting they are tracking above long-range plan targets. This is evidenced by the company’s robust revenue growth of 22.37% over the last twelve months. Evercore projects iRhythm will maintain consistent mid-teens topline growth over the next five years, driven by its base business and expansion into overseas markets including Japan and the EU.
Evercore identified iRhythm’s AI algorithm as a key differentiator, stating it has analyzed over trillions of heartbeats, resulting in a Zio monitor with higher diagnostic yield and fewer repeat tests compared to competitors.
The firm expects iRhythm to achieve approximately 15% adjusted EBITDA margin by fiscal year 2027, driven by 450 basis points of gross margin expansion and 1150 basis points of operating leverage. Evercore sees a path to approximately 20% adjusted EBITDA margins by 2030.
Evercore’s $185 price target represents 7x calendar year 2026 EV/Sales or 10x CY26 EV/Gross Profit, with a discounted cash flow model implying a 5.5% terminal growth rate based on peak revenues of approximately $2.5 billion. For deeper insights into iRhythm’s valuation metrics and growth potential, access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 US stocks with expert analysis and actionable intelligence.
In other recent news, iRhythm Technologies reported better-than-expected financial results for the second quarter of 2025. The company posted an adjusted net loss of $0.32 per share, outperforming analysts’ projections of a $0.51 loss per share. Revenue for the quarter reached $186.7 million, exceeding expectations and representing a 26.1% increase from the previous year. Additionally, BofA Securities initiated coverage on iRhythm Technologies with a Buy rating, setting a price target of $200.00. The firm highlighted iRhythm’s innovative approach to cardiac monitoring with its Zio system. However, iRhythm faced scrutiny from Spruce Point Capital Management, which issued a short report estimating a 40%-70% potential downside for the company’s shares. The report raised concerns about the credibility of iRhythm’s management and the effectiveness of its cardiac monitoring products. These developments provide a multifaceted view of iRhythm Technologies’ current position in the market.
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