On Wednesday, Wells Fargo (NYSE:WFC) adjusted its stance on RxSight Inc. (NASDAQ: RXST), downgrading the stock from Overweight to Equal Weight and revising the price target to $42.00 from the previous $56.00.
"We are downgrading RXST to Equal Weight from Overweight because we see a lack of catalysts and limited upside to 2025 revenue growth," the firm said.
The firm based its new price target on approximately 6.5 times its projected sales for 2026. The reassessment comes after a survey conducted in July, which included responses from 50 cataract surgeons, indicated a more modest year-over-year growth in Light Adjustable Lens (LAL) volume for the year 2025. The projected increase of 22% fell significantly short of the previously estimated growth rate of 49%.
The survey revealed that most of the surgeons were already using LAL in their practice and did not anticipate significant growth in their LAL procedures for the year 2025. Furthermore, the survey suggested that the market might be approaching a saturation point, especially among high-volume, premium cataract surgeons, with only a few new LAL adopters expected in 2025.
The barriers to broader adoption of LAL, as cited by the surgeons, include the cost of the procedure, the complexity of post-operative workflow, and unexpectedly, limited patient interest. The latter was described as too niche, which could potentially hinder the anticipated volume growth of RxSight's LAL procedures.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.