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On Friday, BTIG analysts increased the price target on iRhythm Technologies (NASDAQ:IRTC) to $135 from the previous $120 while maintaining a Buy rating on the stock. The adjustment follows iRhythm’s reported fourth-quarter revenue of $164.3 million, a 24% year-over-year increase that surpassed both the consensus estimate of $157.1 million and BTIG’s own projection of $158.3 million. According to InvestingPro data, the company has maintained strong momentum with a 20.13% revenue growth over the last twelve months and an impressive YTD return of 24.95%. The revenue boost was attributed to robust volume growth across all customer channels and a record number of new account openings for Zio Monitor and Zio AT.
iRhythm’s strong performance in the quarter was also helped by disruption in a competitor’s mobile cardiac telemetry (MCT) business and the introduction of a new innovative channel partner. The company achieved higher gross margins and controlled operating expenses, leading to an adjusted EBITDA that exceeded expectations by approximately $4 million. InvestingPro analysis reveals the company maintains a healthy gross profit margin of 68.86% and operates with a moderate level of debt, though investors should note it’s currently trading above its Fair Value. iRhythm has reiterated its 2025 sales guidance of $675-$685 million, which represents a 14.9% year-over-year increase at the midpoint, aligning with the consensus estimate of $679.4 million.
The company has also introduced full-year adjusted EBITDA guidance of 7-8%. This projection takes into account modest improvements in gross margins, which are expected to be balanced by the impact of tariffs, specifically an anticipated 50-75 basis points of headwinds from tariffs on imports from Mexico. Despite facing regulatory challenges in 2024, iRhythm has shown consistent acceleration in volume growth each quarter, which analysts believe reflects the company’s product differentiation and success in opening new channels, particularly in primary care.
iRhythm continues to make strides toward addressing the outstanding FDA warning letter and 483 observations, with a target to complete these efforts by mid-2025. The company also plans to finalize its internal compliance initiatives by the end of this year. Submission timelines for Zio MCT remain on track for the third quarter. The analysts at BTIG remain optimistic about iRhythm’s ability to sustain high-teens sales growth into 2025, which is reflected in their decision to raise the price target and maintain a Buy rating on the stock. With a market capitalization of $3.5 billion and a remarkable six-month return of 59.43%, investors seeking deeper insights can access comprehensive analysis and additional ProTips through InvestingPro’s detailed research reports.
In other recent news, iRhythm Technologies reported a 24% year-over-year increase in revenue for the fourth quarter of 2024, reaching $164.3 million, surpassing expectations of $158.1 million. The company also achieved an adjusted EBITDA of $19.3 million, exceeding the consensus estimate of $15.5 million. Citi analyst Joanna Wuensch responded by raising the price target to $130 while maintaining a Buy rating, citing strong performance and a positive future outlook. Needham analysts also increased their price target to $112, reaffirming a Buy rating, driven by iRhythm’s robust sales strength and promising revenue guidance for 2025.
In other developments, Oppenheimer reiterated an Outperform rating with a $120 price target following an FDA recall of a competing product, suggesting potential market share gains for iRhythm. The firm’s analysts highlighted the strategic use of iRhythm’s Zio product in primary care settings, which aids in reducing hospital congestion. Meanwhile, board member Mojdeh Poul announced she will not seek re-election as she transitions to her role as CEO of Integra LifeSciences. This board change aligns with iRhythm’s ongoing strategic focus on innovation in medical technology.
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