Stifel initiates Kestra stock with Buy, $28 price target

Published 31/03/2025, 07:54
Stifel initiates Kestra stock with Buy, $28 price target

On Monday, Stifel analysts began coverage on Kestra Medical (TASE:BLWV) Technologies (NASDAQ:KMTS) with a Buy rating and a price target of $28.00. Currently trading at $23.43, the stock sits near its 52-week high of $25.98, with InvestingPro data indicating overbought conditions. They anticipate that the company’s shares will trade at 9 times their projected calendar year 2027 revenue of $168.7 million, with this valuation discounted back to the end of calendar year 2025.

The analysts highlighted the potential of Kestra’s ASSURE system, a wearable cardiac protection and monitoring device, to capture market share and achieve over 40% year-over-year sales growth for the next three years. With a current market capitalization of $1.2 billion and last twelve months revenue of $45.82 million, InvestingPro analysis shows the company maintains a healthy current ratio of 2.81, indicating strong short-term financial stability. They cited several factors contributing to this outlook, including the large existing market for the device, its distinct product advantages, readiness to compete, evolving sales strategies, and the seasoned experience of the company’s leadership.

Kestra’s ASSURE system is designed to offer enhanced comfort, wearability, and connectivity between patients and healthcare providers. It also boasts superior arrhythmia detection capabilities compared to the sole competing product currently available in the wearable cardioverter defibrillator (WCD) market. The analysts noted that ASSURE stands out in the market for approximately 850,000 U.S. patients at high risk of sudden cardiac arrest.

With FDA approval already secured and strong clinical data supporting the product, along with established reimbursement pathways, Kestra is now focused on commercial execution. Operating with moderate debt levels and maintaining strong liquidity, Kestra appears well-positioned for growth. Stifel’s analysts see Kestra’s immediate goal as capturing a share of the approximately $1 billion U.S. WCD market, which is both well-established and expanding. For deeper insights into Kestra’s financial health and growth potential, including additional ProTips and detailed metrics, investors can access comprehensive analysis through InvestingPro.

In other recent news, Kestra Medical Technologies has made significant corporate moves following its initial public offering. The company has issued warrants for the purchase of common shares to two investment entities, Kennedy Lewis (JO:LEWJ) Capital Partners (WA:CPAP) Master Fund II LP and Perceptive Credit Holdings IV, LP. Kennedy Lewis received warrants for 62,325 common shares (Tranche A) and 46,744 common shares (Tranche B), while Perceptive Credit Holdings received warrants for 325,847 common shares. Additionally, Kestra’s board of directors approved the 2025 Omnibus Incentive Plan, which aims to incentivize performance among employees and directors through various share-based awards. The company also announced amendments to its bye-laws and an increase in authorized share capital to $100 million, divided into 100 million common shares. These developments were detailed in a recent SEC filing, reflecting Kestra’s strategic efforts to strengthen its position in the medical technology sector.

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