Avita Medical’s 26% decline presents buying opportunity, says Lake Street

Lake Street analyst Brooks O’Neil notes that Avita Medical shares declined 26% after the company announced on Sunday that the FDA has requested additional information before it can approve RECELL Go. The firm suspects that beyond the initial disappointment related to the delay, “at least some may anticipate a change in the expected trajectory of growth ahead” for Avita, but the firm does not, at least in part because it had included no incremental growth in its model related to approval of RECELL Go. The firm, which is not changing its forecast for 2024 and views the stock decline as one that presents an opportunity, affirms a Buy rating and $40 price target on Avita shares.