Truist Securities initiates coverage on Carlsmed stock with Buy rating

Investing.com - Truist Securities initiated coverage on Carlsmed Inc (NASDAQ:CARL) with a Buy rating and a price target of $18.00 on Monday.

The research firm highlighted Carlsmed as an emerging high-growth spine implant company that recently completed its IPO on July 23. The company markets an AI-enabled platform called aprevo to treat degenerative disc disease.

Truist Securities noted that the platform offers more predictable alignment and reduced revision rates compared to traditional treatments. The firm also pointed to established coding and payer coverage that supports attractive hospital economics, even with Carlsmed’s price premium.

The research firm emphasized Carlsmed’s "asset-light" business model, which should prove scalable as the company increases adoption into what Truist estimates is a $13.4 billion US lumbar fusion market opportunity.

Truist Securities projects that Carlsmed’s planned expansion into the cervical market in 2026 will further increase its total addressable market, with the firm forecasting a revenue compound annual growth rate exceeding 50% from 2024 to 2028. The company’s revenue growth forecast for FY2025 stands at 55%, according to InvestingPro data.

In other recent news, Carlsmed Inc. has made significant strides with its initial public offering, pricing its shares at $15.00 each and raising approximately $100.5 million. The company began trading on the Nasdaq Global Select Market, offering 6,700,000 shares of common stock. In addition to its IPO, several investment firms have initiated coverage on Carlsmed, reflecting confidence in its market position and growth potential. BTIG has started coverage with a Buy rating, citing the company’s innovative approach in the lumbar spinal implant market. Piper Sandler also initiated coverage with an Overweight rating, highlighting the uniqueness of Carlsmed’s 3D-printed spinal implants. Goldman Sachs joined with a Buy rating, pointing to Carlsmed’s projected revenue growth and efficient business model. These developments underscore the company’s differentiated technology and its potential impact on the spinal implant industry.

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