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Investing.com - Stifel has reduced its price target on DarioHealth Corp. (NASDAQ:DRIO) to $16.00 from $25.00 while maintaining a Buy rating on the stock. The current stock price of $9.92 represents significant potential upside to the new target, with InvestingPro data suggesting the stock is undervalued based on its Fair Value assessment.
The price target adjustment follows DarioHealth’s third-quarter results, which showed revenue and EBITDA loss modestly below consensus expectations. The performance reflected a known transition in scope with a large national health plan and a shift away from non-recurring revenue. Over the last twelve months, DarioHealth generated $27.15 million in revenue with a gross profit margin of 69.49%, though the company posted an EBITDA loss of $35.26 million during this period.
Stifel noted that DarioHealth has $12 million in signed or late-stage annual recurring revenue (ARR) and an additional $69 million of ARR in the pipeline. Despite these positive indicators, the firm continues to model its 2025/2026 revenue and EBITDA estimates below street expectations due to limited visibility on the timing of contract signings and ramps. InvestingPro data shows the company achieved 41.79% revenue growth over the last twelve months, though analysts anticipate a 12% sales decline in the current year.
The company’s expense reduction efforts continued to trend positively, with costs down 6-7% quarter-over-quarter and over 36% year-over-year. Stifel expects this trend to continue into 2026, partially mitigating the impact of lower revenue. The company maintains a healthy current ratio of 3.3, indicating liquid assets exceed short-term obligations, while operating with a moderate debt-to-equity ratio of 0.49.
The new $16 price target was derived by applying a 5x multiple to Stifel’s 2027 revenue estimate for DarioHealth, adjusted following the company’s recent 20-1 reverse stock split. The broader analyst consensus remains strongly bullish with a 1.5 rating, with price targets ranging from $12 to $27. For deeper insights into DarioHealth’s valuation and over 30 additional ProTips, access the comprehensive Pro Research Report available on InvestingPro.
In other recent news, DarioHealth Corp reported disappointing financial results for the third quarter of 2025. The company’s earnings per share (EPS) came in at -2.96, which was significantly below the forecasted -0.19. Additionally, revenue for the quarter was $5 million, falling short of the expected $8.54 million. These figures highlight a challenging period for DarioHealth, as investors reacted to the results. The company’s financial performance has been under scrutiny, given the substantial gap between actual and projected earnings. Analysts and investors alike are closely monitoring these developments. The results have sparked discussions about the company’s future strategies and potential adjustments. These recent developments are crucial for stakeholders evaluating DarioHealth’s current position and future outlook.
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