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On Friday, TD Cowen analysts maintained their Buy rating and $4.50 price target for Butterfly Network (NYSE:BFLY), following a significant drop in the company’s stock. The decline, which resulted in a 13.3% loss over the past week according to InvestingPro data, was attributed to a misreported news headline that was later rectified. Despite recent volatility, the stock has shown remarkable strength with a 242% gain over the past six months. The original headline incorrectly claimed that Butterfly Network had not met Wall Street’s fourth-quarter expectations. Contrary to this, Butterfly Network’s fourth-quarter sales and EBITDA results actually surpassed the forecasts. InvestingPro data shows the company maintains a strong financial position with a current ratio of 4.66, indicating robust liquidity to meet short-term obligations.
The analysts at TD Cowen highlighted the company’s strong performance despite the initial confusion in the market. They pointed out that Butterfly Network’s revenue guidance for the year 2025 encompasses the consensus outlook and indicates an approximate 20% growth rate. The analysts believe this forecast could be on the conservative side, particularly given the company’s recent revenue growth of 11.5% and moderate debt levels, with a debt-to-equity ratio of just 0.13.
The erroneous headline that caused the stock’s initial fall was promptly corrected, clarifying that Butterfly Network had indeed achieved better-than-expected results for the fourth quarter. The company’s financial outcomes for the quarter were solid, with both sales and EBITDA exceeding the targets set by analysts.
Butterfly Network’s guidance for the future also remains promising. The company’s projected revenue growth for 2025 is aligned with market expectations, suggesting a steady upward trajectory for the business. TD Cowen’s analysts have expressed confidence in Butterfly Network’s potential for growth and have therefore reiterated their positive stance on the stock.
In summary, despite the temporary setback caused by the inaccurate news report, Butterfly Network’s actual performance in the fourth quarter was strong, and the company’s outlook remains optimistic. The TD Cowen analysts’ reiteration of a Buy rating and a $4.50 price target reflects their belief in the company’s continued success. For deeper insights into Butterfly Network’s financial health and growth prospects, including additional ProTips and comprehensive analysis, check out the full research report available on InvestingPro.
In other recent news, Butterfly Network reported fourth-quarter revenue of $22.4 million, surpassing analyst estimates of $20.1 million and marking a 35% year-over-year increase. The company’s adjusted earnings per share were -$0.08, slightly better than the -$0.09 consensus forecast. Product revenue saw a significant boost, rising 45% to $14.7 million, driven by increased unit sales and higher prices for the iQ3 ultrasound probe. Software (ETR:SOWGn) and services revenue also grew by 20%, reaching $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 indicating approximately 20% year-over-year growth. The company also bolstered its financial position by raising $81.7 million through a public offering, intended to fuel innovation and broaden access to its imaging technology. Despite the positive revenue results, shares experienced a slight dip, possibly due to investor expectations for more aggressive growth. TD Cowen analyst Joshua Jennings reiterated a Buy rating for Butterfly Network, attributing a recent stock pullback to a corrected news headline and noting that the company’s 2025 revenue guidance suggests conservative growth.
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