On Tuesday, Lake Street Capital Markets updated its outlook on Myomo Inc . (NYSE:MYO), increasing the price target to $7.50 from the previous target of $7.00, while keeping a Buy rating on the company's stock. The adjustment follows Myomo's preliminary revenue report, which indicated a significant outperformance against forecasts.
The firm acknowledged the company's preliminary revenues, which were over 40% higher than expected, as a major positive. Myomo's management was also caught off guard by the quicker-than-anticipated payments from the Centers for Medicare & Medicaid Services (CMS), which led to a substantial exceedance of the company's second-quarter guidance of over $5.0 million.
The analyst highlighted that revenue recognition for Part B beneficiaries did not impact this quarter's results. This suggests that Myomo is on track to surpass the previously set annual guidance range of $28-$30 million, potentially reaching a $30 million+ annualized revenue run-rate. Looking forward, the analyst projects that Myomo could achieve a $40 million annualized run rate in the third quarter and possibly exceed $50 million in the fourth quarter.
Additionally, the company's statement about effectively adding necessary personnel to increase production and deliveries in the latter half of the year was noted. Lake Street Capital Markets expressed confidence that even with raised estimates, there remains considerable potential for Myomo to continue surpassing performance expectations.
The firm also remarked on the company's position in the market, pointing out Myomo's rapid growth in an environment with no competition. Moreover, the company's financial position, with sufficient cash to reach breakeven, was underscored as a factor that should capture investor attention.
In other recent news, Myomo, Inc. has reported a growth of 9% in its first-quarter revenue for 2024, reaching $3.8 million. This comes in light of new developments with the Centers for Medicare and Medicaid Services (CMS), including the reclassification of their MyoPro product and new pricing, expanding their market potential. Furthermore, Myomo is projecting a second-quarter revenue exceeding $5 million and has set a goal for full-year revenue between $28 million to $30 million.
The company has also announced plans to double its manufacturing capacity and extend its reach in the international market, specifically in Germany. Despite challenges related to payment and timing, Myomo has seen a substantial increase in its backlog, with a record 275 units and 83 Medicare Part B patients. The company has expressed confidence in its ability to increase revenue and achieve cash flow breakeven by the end of 2024.
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