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Investing.com - Goldman Sachs initiated coverage on Shoulder Innovations (NYSE:SI) with a Buy rating and a price target of $20.00 on Monday. The stock, currently trading at $12.71, has experienced an 11.3% decline over the past week, according to InvestingPro data.
The investment bank cited the company’s revenue growth trajectory, attractive end-market, and small to mid-cap medical technology comparables as reasons for seeing meaningful upside to current valuation. The company maintains strong financial health with a current ratio of 7.1 and operates with a moderate debt level.
Goldman Sachs identified key growth drivers for Shoulder Innovations including the anticipated use of IPO proceeds for sales force expansion, the launch of pipeline products with price premiums, and secular tailwinds such as the shift of procedures to outpatient settings.
The firm estimates that IPO proceeds will provide sufficient runway for Shoulder Innovations to reach profitability, modeling the first adjusted EBITDA breakeven quarter in the fourth quarter of 2029, with $39 million in cash on hand at the end of 2029.
Goldman Sachs adopted a target enterprise value to sales next twelve months multiple of 5.5x applied to its Q5-Q8 (3Q26-2Q27) sales estimates of $65 million, with the price target implying a 28% premium to the comparable group.
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