On Thursday, Oppenheimer updated its outlook on Brainsway (NASDAQ:BWAY), a company specializing in brain health technology, by raising its price target to $10.00 from the previous $6.00. The firm maintained an Outperform rating on the stock.
The adjustment followed Brainsway's announcement of fourth-quarter sales that surpassed expectations, reporting revenues of $9 million against the anticipated $8.4 million by Oppenheimer and $8.6 million by the broader market consensus.
The company's performance in the last quarter was bolstered by significant agreements with large enterprise customers, as management continues to target opportunities with larger customer networks. Brainsway's international presence remains robust, with its Deep Transcranial Magnetic Stimulation (Deep TMS) therapy system recently becoming available in South Korea. The fourth quarter saw a worldwide recognition of 60 Deep TMS systems, marking an increase from 46 systems in the third quarter.
Brainsway's financial health also showed positive signs, with the company achieving its second consecutive quarter of positive EBITDA and cash flow. Looking ahead, the company's management has set a sales guidance for 2024 in the range of $37 to $40 million, which represents a year-over-year growth of 16% to 26%. This forecast is notably higher than Oppenheimer's previous estimate of $34.3 million.
The company is also advancing its research and development efforts, with a focus on a new method called Deep TMS 360. This innovation aims to activate a greater number of neurons in the brain and is currently being evaluated for potential applications in treating stroke and obsessive-compulsive disorder (OCD).
InvestingPro Insights
Following the positive update from Oppenheimer on Brainsway (NASDAQ:BWAY), InvestingPro metrics provide a deeper dive into the company's financial situation and market performance. With a market capitalization of $103.03 million, Brainsway stands as a noteworthy player in the brain health technology sector. Despite the company's recent successes, the InvestingPro Data indicates a negative P/E ratio of -23.83, reflecting that the company is not currently profitable. This aligns with one of the InvestingPro Tips that analysts do not anticipate Brainsway will be profitable this year.
However, investors may find solace in the company's strong performance metrics over the past year, with a 1 Year Price Total Return of 202.94%, showcasing significant market confidence. Additionally, Brainsway's financial health appears resilient, as it holds more cash than debt on its balance sheet and boasts liquid assets that exceed short-term obligations. This financial stability is crucial as the company pursues growth and invests in research and development for its innovative Deep TMS 360 method.
For those looking to delve further into Brainsway's prospects and performance, InvestingPro offers a total of 7 additional InvestingPro Tips that can guide investors in their decision-making process. To access these insights and more, visit InvestingPro and consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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