TD Cowen lifts Butterfly Network target to $5, maintains Buy

Published 28/02/2025, 22:16
TD Cowen lifts Butterfly Network target to $5, maintains Buy

On Friday, TD Cowen analyst Joshua Jennings increased the price target on Butterfly Network stock (NYSE:BFLY) to $5.00, up from the previous $4.50, while retaining a Buy rating on the shares. Currently trading at $3.61, the stock has shown remarkable momentum with a 242% surge over the past six months, despite recent volatility. According to InvestingPro analysis, the stock appears overvalued at current levels. Jennings highlighted the company’s impressive performance, stating, "BFLY had another strong quarter with sales and EBITDA results that beat Street targets."

The analyst’s optimism is rooted in Butterfly Network’s recent financial achievements and its future prospects. With a current market capitalization of $870 million and revenue growth of 11.5% in the last twelve months, the company maintains a strong financial position with a healthy current ratio of 4.66. The company’s 2025 revenue guidance, which suggests a 20% growth, is seen as potentially conservative by Jennings. This projection closely aligns with the consensus outlook, indicating a positive trend for the company. InvestingPro data reveals 8 additional key insights about BFLY’s financial health and growth prospects.

Butterfly Network’s success is attributed to several key factors that are driving the company forward. Among these is the worldwide rollout of its iQ3 product, which Jennings notes as a significant development. Additionally, the company’s progress toward profitability and advancements in its Butterfly Garden, Octiv, and HomeCare initiatives are contributing to the bullish outlook for 2025 and the years to follow.

Jennings’ commentary reflects confidence in Butterfly Network’s strategic direction and its ability to capitalize on its innovations. "This plus its profitability progress and advances with Butterfly Garden, Octiv and HomeCare make us bullish on 2025 and beyond," he elaborated.

Investors and market watchers will likely keep a close eye on Butterfly Network as it continues to execute its growth strategy and leverage its product offerings to meet and exceed financial expectations. With the raised price target and sustained Buy rating, TD Cowen signals its belief in the company’s potential for sustained growth and market performance.

In other recent news, Butterfly Network reported fourth-quarter revenue of $22.4 million, surpassing analyst expectations of $20.1 million and reflecting a 35% year-over-year increase. The company’s adjusted earnings per share were slightly better than anticipated, coming in at -$0.08 compared to the consensus forecast of -$0.09. Product revenue increased by 45% to $14.7 million, driven by a 22% rise in units sold and higher prices for the new iQ3 ultrasound probe. Software (ETR:SOWGn) and services revenue also grew by 20% to $7.6 million. For fiscal 2025, Butterfly Network projects revenue between $96 million and $100 million, aligning with Wall Street’s estimate of $97.8 million and representing approximately 20% growth. Despite the positive earnings report, the stock experienced a slight dip, possibly due to investor concerns about the company’s future growth targets. TD Cowen analysts reiterated a Buy rating and maintained a $4.50 price target, highlighting the company’s strong performance and potential for growth. The company recently bolstered its financial position by raising $81.7 million through a public offering, aimed at driving innovation and expanding access to its imaging technology.

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