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Monday, Needham analysts raised the price target on Lucid (NASDAQ:LCID) Diagnostics Inc (NASDAQ:LUCD) shares to $3.00 from $2.50, while maintaining a Buy rating on the stock. The upgrade reflects an optimistic outlook for the company’s revenue growth, particularly following a significant increase in the volume of its EsoGuard tests. According to InvestingPro data, the stock has shown impressive momentum, surging nearly 97% over the past six months, with analyst targets ranging from $2 to $7.
In the fourth quarter of 2024, Lucid Diagnostics reported an 84% year-over-year growth in EsoGuard test volume, reaching a total of 4,042 tests. Despite this substantial increase, the company did not meet the consensus revenue expectations for the quarter. The discrepancy was attributed to collections not keeping pace with the volume of tests conducted. The company’s revenue growth remains strong, with InvestingPro showing a 179% year-over-year increase, though gross profit margins remain challenging at -53%.
The company’s operating expenses for the same period were slightly higher than Needham’s estimates. However, Lucid Diagnostics concluded the quarter with approximately $37 million in pro forma cash, bolstered by a $15 million capital raise in March. With a market capitalization of $84.28 million and moderate debt levels, the company’s financial health score on InvestingPro is rated as "FAIR" - discover more insights with an InvestingPro subscription, including 12 additional ProTips and comprehensive financial analysis.
Looking ahead, analysts at Needham anticipate Lucid Diagnostics’ revenue growth to accelerate and the gap with EsoGuard volume growth to narrow. This expectation is based on the potential for increased coverage from Medicare, with a MolDX draft expected in the first half of 2025, and from other insurance providers.
The decision to increase the price target to $3.00 is a result of shifting the valuation basis to the company’s projected revenue for the year 2026. This adjustment reflects the analysts’ confidence in Lucid Diagnostics’ future financial performance.
In other recent news, Lucid Diagnostics Inc. reported its fourth-quarter 2024 earnings, revealing a greater-than-expected loss per share and revenue figures that fell short of forecasts. The company posted an EPS of -$0.19, missing the anticipated -$0.17, and reported revenue of $1.19 million, below the expected $1.43 million. Despite this, Lucid Diagnostics achieved a record quarterly test volume of 4,000 tests and secured a significant NIH grant to expand its cancer screening indications. Additionally, the company is optimistic about potential Medicare coverage decisions expected in the first half of 2025, which could significantly boost its market reach.
Lucid Diagnostics also announced that Highmark Blue Cross Blue Shield of New York established a positive commercial insurance coverage policy for its EsoGuard test. This is seen as an important precedent for future engagements with commercial payers. Analysts from firms like Canaccord Genuity and BTIG have shown interest in the company’s strategy for revenue generation and the potential impact of the NIH-funded study on market expansion. Furthermore, Lucid Diagnostics has restructured its commercial team to focus on revenue-driving activities, including a concierge medicine cash pay program that has already signed 20 contracts. The company is preparing for increased demand with expanded laboratory and manufacturing capabilities, aiming to reduce its burn rate by 50% in the latter half of 2025.
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