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On Thursday, Stifel analysts maintained a Hold rating on RxSight Inc. (NASDAQ:RXST) with a steady price target of $28.00. The decision follows RxSight’s preliminary first-quarter results for 2025, which fell short of expectations. The company reported revenues of $37.9 million, which did not meet the predicted $39.8 million. According to InvestingPro data, RxSight maintains a strong financial health score of 3.09 (rated as "GREAT"), despite the stock’s significant decline of over 45% in the past six months. Additionally, RxSight revised its 2025 revenue guidance downward, from the previous range of $185 million to $197 million to a new forecast of $160 million to $175 million. While this represents a setback, InvestingPro analysis shows the company maintains robust liquidity with a current ratio of 11.36 and holds more cash than debt on its balance sheet. For deeper insights into RxSight’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.
The reduction in expected revenues is attributed to lower Light Adjustable Lens (LAL) volumes, with year-over-year utilization growth estimated at a negative 5%, as opposed to the anticipated positive 5%. This marks the third consecutive quarter of decelerating utilization growth for RxSight. The company’s management has cited the weakness in the premium Intraocular Lens (IOL) market and overall economic softness as reasons for the LAL underperformance.
Stifel’s analysis suggests that RxSight shares are likely to experience a significant drop in value. They project that based on estimated 2026 sales of $210 million to $220 million, the shares could be valued between $18 and $21, which is substantially lower than the current price target. InvestingPro’s Fair Value analysis indicates the stock is currently overvalued, with analyst targets ranging from $22 to $56, reflecting the market’s mixed outlook on the company’s prospects. The firm has been monitoring the situation since July and has observed a consistent downturn in LAL trends, which are now manifesting in the company’s performance.
Looking forward, the main question posited by Stifel is whether the observed slowdown is due to economic factors, increased competition, or if the LAL product has reached a less favorable stage in the US adoption curve. The analysts are considering the possibility that LAL may have already arrived at the "late-majority" phase, which could impact its market growth potential.
In other recent news, RxSight Inc. announced a revenue of $37.9 million for the first quarter of 2025, marking a 28% year-over-year increase but missing the consensus estimate of $39.8 million. This shortfall has led to a downward revision of its 2025 revenue guidance by 12%, now projected between $160 million and $175 million. BofA Securities responded to these developments by downgrading RxSight’s stock rating from Buy to Underperform and reducing the price target to $22 from $36, citing concerns over market saturation and decreased procedure volumes. Meanwhile, Needham maintained its Buy rating with a $43 price target, acknowledging strong sales of Light Delivery Devices despite lower utilization rates.
Stifel also adjusted its outlook, lowering the price target to $28 while maintaining a Hold rating, noting concerns about market share growth among surgeons. Jefferies, however, kept a Buy rating with a reduced price target of $50, citing confidence in RxSight’s long-term prospects and potential international market approvals. BofA Securities had previously reduced the price target to $36 while retaining a Buy rating, following discussions with company executives. Analysts have expressed varying degrees of optimism about RxSight’s valuation, with some highlighting potential benefits from a competitor’s product recall and others pointing to challenges in maintaining market share growth.
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