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On Tuesday, Raymond (NSE:RYMD) James maintained a Strong Buy rating on RadNet (NASDAQ:RDNT) shares, increasing the price target to $66 from $65 following the company’s first-quarter earnings. RadNet’s revenue and adjusted EBITDA for the quarter exceeded expectations, prompting the firm to adjust its price target. According to InvestingPro data, analysts maintain a strong bullish consensus with price targets ranging from $60 to $80, suggesting potential upside from current levels around $57.
The diagnostic imaging company reported a revenue of $471.4 million, surpassing the Street’s forecast of $443.1 million and Raymond James’s estimate of $450.7 million. Adjusted EBITDA came in at $46.4 million, also outperforming the Street’s prediction of $45.5 million and Raymond James’s projection of $45.0 million. The company’s trailing twelve-month revenue stands at $1.87 billion, with a healthy revenue growth of 12.8%. In response to these results, management has modestly increased the full-year guidance to a range of $283-293 million. This uplift is primarily attributed to a $3 million rise in the core imaging business, while the digital health segment’s guidance remains unchanged.
Despite facing challenges such as poor weather and the Los Angeles wildfires earlier in the year, which negatively impacted revenue by $22 million and EBITDA by $15 million, RadNet’s volumes saw a significant rebound in March and April. Without these adverse weather events, the company’s EBITDA would have grown by 5% in the first quarter.
The analyst noted that while 2025 is considered an "okay" year for RadNet, burdened by increased labor expenses, salesforce investments in DeepHealth Operating System, and weather-related setbacks, the outlook for 2026 is more promising. The company is expected to face easier comparisons next year and may start to see cost savings from the internal implementation of the DeepHealth OS. InvestingPro analysis reveals that net income is expected to grow this year, with analysts predicting a return to profitability. Get deeper insights into RadNet’s financial health and growth prospects with InvestingPro’s comprehensive research report, available along with 8 additional key ProTips.
In other recent news, RadNet Inc reported its Q1 2025 earnings, showcasing a revenue increase to $471.4 million, which surpassed forecasts of $446.21 million. Despite the revenue beat, the company posted an earnings per share (EPS) of -$0.5, falling short of the forecasted -$0.108. RadNet has also revised its 2025 revenue guidance upward by $10 million and its adjusted EBITDA guidance by $3 million, indicating optimism about future performance. The company announced the strategic acquisition of iCAD Inc (NASDAQ:ICAD), a move expected to enhance its AI capabilities in breast health solutions. Additionally, the firm raised its 2025 revenue and adjusted EBITDA guidance, reflecting confidence in stable Medicare reimbursement rates for 2026. Analyst firm Jefferies noted that RadNet continues to see growth in advanced imaging, which is expected to drive future revenue. Furthermore, RadNet’s digital health segment reported a significant 31.1% increase in revenue year-over-year, highlighting the company’s focus on expanding its digital offerings.
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