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Investing.com - Evercore ISI initiated coverage on Penumbra (NYSE:PEN), a $10.6 billion market cap healthcare company, with an Outperform rating and a $300 price target, representing approximately 10% upside from current levels. According to InvestingPro data, the stock is currently trading above its Fair Value, with technical indicators suggesting overbought conditions.
The research firm cited Penumbra’s potential to accelerate its topline heading into fiscal year 2026 as headwinds in China abate and new products launch. This outlook builds on the company’s impressive 12.9% revenue growth over the last twelve months. Evercore specifically highlighted the STORM PE product, which it believes has the potential to change medical practice and represents approximately $500 million revenue opportunity.Get deeper insights into Penumbra’s growth prospects with InvestingPro, which offers exclusive analysis and 13 additional ProTips for informed investment decisions.
Evercore also noted Penumbra has a "highly visible gross margin expansion pathway," projecting approximately 400 basis points of gross margin expansion potential in the medium term. The company already maintains a healthy gross margin of 66.5%, and this expansion is expected to be driven mainly by mix changes, with faster-growing thrombectomy products carrying higher margins, and manufacturing shifts to Costa Rica.
The firm believes Penumbra has significant opportunity to leverage its SG&A base, which should enable the company to drive what Evercore describes as "best in class" earnings per share growth of approximately 25% over the medium term.
Penumbra, a global healthcare company focused on innovative therapies, specializes in addressing challenging medical conditions with novel solutions for thrombectomy and embolization procedures.
In other recent news, Penumbra, Inc. reported its second-quarter 2025 earnings, surpassing both earnings per share (EPS) and revenue forecasts. The company posted an EPS of $0.86, exceeding the anticipated $0.83, and achieved a revenue of $339.5 million, above the expected $327.77 million. Following these results, Penumbra raised its 2025 revenue guidance, highlighting robust growth in its peripheral vascular segment and strong performance in its stroke business. UBS responded by raising its price target for Penumbra to $335, maintaining a Buy rating, while RBC Capital adjusted its target to $325, keeping an Outperform rating. Additionally, the company announced the promotion of Shruthi Narayan to President, effective September 1, 2025. Narayan, who has been with Penumbra since 2013, will continue to report to CEO Adam Elsesser. These developments reflect Penumbra’s ongoing growth and strategic leadership changes.
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