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On Friday, Truist Securities maintained a positive outlook on Vericel Corporation (NASDAQ:VCEL), reiterating a Buy rating and a $52.00 price target, which represents significant upside from the current price of $41.76. The stock, which InvestingPro analysis indicates is currently fairly valued, has analyst targets ranging from $52 to $67. The endorsement follows recent investor meetings with Vericel’s CEO Nick Colangelo, CFO Joe Mara, and VP of Finance and Investor Relations Eric Burns, which provided Truist analysts with deeper insights into the company’s growth trajectory and margin expansion potential.
The discussions with Vericel’s management focused on several key areas, including the volume expectations for MACI, a product used in knee cartilage repair, into the second quarter. They also touched on the progress of the MACI Arthro launch, the growth patterns for Epicel and NexoBrid—products for burn care—and the plans to expand the sales force in the second half of the year. The talks further delved into long-term margin considerations for the company, which currently maintains a healthy gross profit margin of 72.5% and operates with moderate debt levels.
Analysts at Truist came away from the meetings with a reinforced belief in Vericel’s capacity to sustain revenue growth exceeding 20% in 2025 and beyond. The confidence stems from positive indicators such as increased biopsy activity and doctor training for MACI Arthro and Epicel, which are expected to accelerate growth starting in the second quarter of 2025.
Vericel’s continued focus on these areas is seen as a critical factor in the company’s growth acceleration, particularly with respect to MACI and burn treatment products. Truist analysts underscored the company’s potential as a small to mid-size enterprise with the rare ability to achieve over 20% growth, coupled with an inflection point in profitability and cash flow.
In other recent news, Vericel Corp reported its Q1 2025 earnings, revealing a record total net revenue of $52.6 million, which was slightly below the forecast of $53.84 million. The company reported a net loss of $11.2 million, or $0.23 per share, missing the EPS forecast of -$0.1338. Despite the earnings miss, Vericel has raised its full-year revenue growth guidance to 20-23%, reflecting confidence in continued strong performance, particularly from its MACI segment. The company anticipates Q2 revenue growth of 22-25%, supported by the robust growth in MACI and NexoBrid revenues. Analysts from BTIG and other firms have shown interest in Vericel’s strategic initiatives, particularly the MACI Arthro launch, which has shown promising early indicators. The company is also planning to expand its MACI sales force later in the year, aiming to support anticipated growth. Vericel’s management remains optimistic about its market expansion plans and strategic direction, despite the operational challenges reflected in the Q1 results.
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