JPMorgan initiates Heartflow stock with Overweight rating, $36 price target

Investing.com - JPMorgan has initiated coverage on Heartflow Inc (NASDAQ:HTFL) with an Overweight rating and a price target of $36.00. The stock, currently trading at $31.50, shows technical signs of being overbought according to InvestingPro data.

The investment bank identifies Heartflow as "one of the clearest and most pioneering downstream beneficiaries of the AI revolution in the healthcare sector," noting its position at the intersection of regulated healthcare and technology. With a market capitalization of $2.64 billion, the company has generated revenue of $136.17 million in the last twelve months.

Heartflow’s platform uses artificial intelligence and computational fluid dynamics to create personalized 3D models of patients’ hearts from coronary computed tomography angiography (CCTA) scans, addressing clinical needs in coronary artery disease diagnosis.

JPMorgan highlights that Heartflow is among the first medical technology companies to offer a "clinically meaningful and reimbursed product" leveraging machine learning and AI while potentially streamlining workflow and reducing overall care costs.

The firm points to several advantages in Heartflow’s business model, including its capital-light structure, "excellent gross margin profile" (currently at 75.62%), clinical and regulatory moat with healthy reimbursement, and a "highly differentiated diagnostic solution in a large, untapped market." InvestingPro analysis reveals strong liquidity with a current ratio of 3.33, though the company is currently trading at a high revenue multiple. Discover more insights and 5 additional ProTips with an InvestingPro subscription.

In other recent news, Heartflow Inc. successfully completed an upsized initial public offering, raising approximately $364.2 million in gross proceeds. The company sold 19,166,667 shares of common stock at $19 per share, including 2,500,000 additional shares after underwriters exercised their option in full. This capital influx is expected to support Heartflow’s ongoing operations and future growth initiatives. In another development, Stifel initiated coverage on Heartflow with a Buy rating and set a price target of $35.00. This target is based on Stifel’s 2026 revenue projection of $207.6 million, reflecting a 14.0x multiple. These recent developments highlight growing investor interest and confidence in Heartflow’s market potential.

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