PROCEPT BioRobotics: Hold Rating Amid Strong Revenue but Concerns Over Utilization and Sales Cycles
Ryan Zimmerman has assigned a Hold rating to PROCEPT BioRobotics, citing strong revenue growth but concerns over handpiece utilization and declining average selling prices. The new CEO emphasizes the need for improved utilization, while management's comments on longer sales cycles and inventory adjustments have led to a cautious outlook. Preliminary revenue guidance suggests potential downward adjustments to estimates. Despite a decrease in valuation, concerns about slowing utilization and high expectations persist, prompting the Hold rating. TR | OpenAI – 4o also reiterated a Hold rating with a $35.00 price target.
Ryan Zimmerman has given his Hold rating due to a combination of factors impacting PROCEPT BioRobotics. The company’s recent quarterly results showed revenue exceeding expectations, driven by strong performance in US Systems and international sales. However, there were concerns about the softness in handpiece utilization growth and a decline in average selling prices for their HYDROS systems. The new CEO has acknowledged the need for improved utilization, which remains a focal point for the company.
Despite efforts to reassure investors about growth prospects, management’s comments on longer sales cycles and inventory adjustments have contributed to a cautious outlook. Preliminary revenue guidance for the upcoming fiscal year suggests that consensus estimates may need to be adjusted downward, and the company must demonstrate better operational execution to bolster confidence. While valuation has decreased, concerns about slowing utilization and high expectations persist, leading to the Hold rating.
In another report released on October 24, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $35.00 price target.
