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On Friday, H.C. Wainwright analyst Swayampakula Ramakanth revised the price target for EDAP TMS S.A. (NASDAQ:EDAP) to $14.00 from the previous $19.00, while retaining a Buy rating on the stock. The adjustment follows EDAP’s disclosure of its first-quarter financial results for 2025 and a corporate update on May 15. The stock, currently trading at $1.76, has experienced significant pressure, declining 74% over the past year. InvestingPro analysis indicates the company is currently undervalued, with 6 additional ProTips available for subscribers.
EDAP’s management is actively working to expand its core Focal One business. The company has been enhancing the Focal One technology platform, launching an alpha version for endometriosis treatment, and witnessing ongoing growth in equipment placements. At the 2025 annual meeting of the American Urological Association, EDAP unveiled the Focal One I Robotic HIFU system, which is compatible with various imaging systems and can integrate multiple data sets. With a market capitalization of $65.81 million and annual revenue of $67.91 million, the company maintains a healthy gross margin of 41.21%.
The company’s recent CE Mark certification has facilitated the controlled market introduction of Focal One for deep infiltrating endometriosis treatment in select European treatment centers. This initial launch is intended to gather clinical data in preparation for a wider release in regions recognizing the CE Mark. Insights from this phase are expected to inform the design of a randomized control Phase 3 study for U.S. marketing approval. While InvestingPro data shows the company is currently burning through cash, it maintains more cash than debt on its balance sheet, providing financial flexibility for these expansion initiatives.
In light of the company’s shift away from non-core businesses, H.C. Wainwright has adjusted its revenue projections for EDAP. The firm now forecasts total revenues to reach €212M by 2031, a reduction from the previous estimate of €260M. This recalibration has influenced the reduction of the 12-month price target for EDAP’s diluted American Depositary Shares (ADS) to $14, down from the earlier prediction of $19. For deeper insights into EDAP’s valuation and growth prospects, InvestingPro subscribers can access a comprehensive Pro Research Report, featuring detailed financial analysis and expert recommendations.
In other recent news, EDAP TMS S.A. reported its fourth-quarter 2024 earnings, showcasing a revenue increase of 3.6% year-over-year to €20.3 million, despite a net loss of €1.9 million, which improved from the previous year’s loss of €5 million. The company’s High-Intensity Focused Ultrasound (HIFU) revenue grew by 15.7% year-over-year, reaching €23.8 million, highlighting strong sales of its Focal One system. Piper Sandler adjusted its price target for EDAP TMS shares to $4.50, maintaining an Overweight rating, while Jefferies downgraded the stock from Buy to Hold, reducing the price target to $2.00 due to concerns over slower sales growth in the HIFU segment. H.C. Wainwright, however, reiterated a Buy rating with a $19.00 price target, expressing optimism about the company’s strategic focus on expanding its Focal One technology to new applications like pancreatic cancer and benign prostatic hyperplasia (BPH).
EDAP TMS is advancing its clinical trials, with active enrollment in the Phase 1/2 PULS study for pancreatic tumors and a similar study for BPH. The company also announced the positive results of the Focal Ablation versus Radical Prostatectomy (FARP) study, which demonstrated the effectiveness of focal ablation in treating localized prostate cancer. CEO Ryan Rhodes highlighted the growing recognition of Focal One as a necessary treatment option for prostate cancer, supported by favorable reimbursement changes from the Centers for Medicare and Medicaid Services. These developments, along with a strategic shift to focus more on HIFU, are expected to drive revenue growth for the company in 2025.
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