Needham, a financial advisory firm, adjusted its outlook on CryoPort (NASDAQ: NASDAQ:CYRX), a logistics company specializing in temperature-controlled supply chain solutions for the life sciences industry.
The firm, on Wednesday, lowered its price target on the company's shares to $11.00 from the previous $18.00. Despite this change, Needham continues to recommend a Buy rating for CryoPort's stock.
The revision follows CryoPort's second-quarter financial report for the year 2024, which showed revenue figures in line with market expectations. However, the company's management announced a downward revision of its revenue forecast for the full year 2024, reducing the guidance midpoint by 7%.
Needham's analyst pointed out that while the reduction in guidance was notable, the quarter had positive aspects, including consistent revenue, better sequential margins and profitability, the introduction of a new restructuring plan, and a stock repurchase program.
CryoPort's recovery in its MVE business—a reference to the company's biostorage and logistics solutions—has been slower than initially anticipated. Nevertheless, Needham's stance is that CryoPort's trajectory towards growth and profitability is trending positively.
The decision to reduce the price target to $11.00 reflects a broader trend of multiple contraction among CryoPort's industry peers, meaning that the valuation multiples investors are willing to pay for these companies have decreased.
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