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Brainsway Ltd (BWAY)
NASDAQ:BWAY
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Brainsway
(NASDAQ:BWAY)
Rating:77Outperform
Price Target:
$11.00
▲(7.95%Upside)
Positive Factors
Clinical Data
Positive clinical data may drive uptake on multiple fronts with favorable clinical datasets reported by Brainsway.
Expansion and Market Penetration
BrainsWay is pursuing U.S. expansion via collaboration with large mental health networks and expanding penetration of international markets, including Canada and East Asia.
Regulatory Approval
BrainsWay received expanded FDA labeling for Deep TMS to treat late-life depression, increasing the upper limit of age range from 68 to 86 years of age and broadening the availability of Deep TMS therapy.
Negative Factors
Financial Flexibility
BrainsWay ended 2024 with almost $70M in cash, cash equivalents and short-term deposits; this is expected to provide considerable strategic flexibility.
Brainsway (BWAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$199.94M
Dividend YieldN/A
Average Volume (3M)31.53K
Price to Earnings (P/E)47.2
Beta (1Y)1.32
Revenue Growth26.86%
EPS GrowthN/A
CountryUS
Employees120
SectorHealthcare
Sector Strength39
IndustryMedical - Devices
Share Statistics
EPS (TTM)0.02
Shares Outstanding18,883,423
10 Day Avg. Volume31,528
30 Day Avg. Volume31,531
Financial Highlights & Ratios
PEG Ratio1.15
Price to Book (P/B)2.63
Price to Sales (P/S)0.00
P/FCF Ratio25.27
Enterprise Value/Market Cap0.50
Enterprise Value/Revenue0.67
Enterprise Value/Gross Profit3.29
Enterprise Value/Ebitda7.77
Forecast
1Y Price Target
$15.33Price Target Upside50.44% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Brainsway Business Overview & Revenue Model
Company DescriptionBrainsway Ltd. (BWAY) is a global leader in advanced noninvasive neurostimulation treatments for mental health disorders. The company specializes in the development and commercialization of Deep Transcranial Magnetic Stimulation (Deep TMS) technology, which is used to treat various neurological and mental health conditions such as major depressive disorder, obsessive-compulsive disorder, and smoking addiction. Operating within the healthcare and medical device sectors, Brainsway's innovative solutions aim to improve patient outcomes through cutting-edge technology and evidence-based treatment protocols.
How the Company Makes MoneyBrainsway makes money primarily through the sale and leasing of its Deep TMS systems to healthcare providers, clinics, and hospitals. Revenue is generated from the direct sale of the equipment as well as from ongoing service agreements and consumables required for the operation of the devices. The company also benefits from recurring revenue streams through leasing arrangements, which provide clients with access to the technology without the need for a large upfront investment. Additionally, Brainsway's revenue is supported by partnerships and collaborations with leading medical institutions and research organizations, which help to expand the adoption and efficacy of its treatments. Regulatory approvals in various countries further enhance its market reach and revenue potential.
Brainsway Earnings Call Summary
Earnings Call Date:May 13, 2025
(Q1-2025)
| % Change Since: 15.40%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call reflected strong growth in both revenue and system shipments, indicating robust demand for BrainsWay's Deep TMS systems. The company is making significant strides in clinical advancements and maintains a strong financial position with positive guidance for the year. However, increased operating expenses and potential geopolitical risks are concerns that need monitoring.Q1-2025 Updates
Positive Updates
Significant Revenue Growth
BrainsWay reported $11.5 million in revenue for Q1 2025, marking a 27% increase year-over-year.
Increased System Shipments
The company shipped 81 Deep TMS systems, a 42% increase compared to the first quarter of 2024.
Strong Backlog and Future Visibility
BrainsWay has a backlog and remaining performance obligation totaling nearly $60 million, indicating clear visibility into future growth.
Clinical Advancements
The first TMS therapy approved for OCD and the first TMS device cleared by the FDA for anxious depression. Over 60% positive response rate for OCD patients.
Solid Financial Performance
Reported gross margin of 75%, increased operating income, and adjusted EBITDA margin, with positive cash flow from operations.
Positive Financial Guidance
Reiterating full-year 2025 financial guidance of $49 million to $51 million in revenue, representing 20% to 24% growth over 2024.
Negative Updates
Increased Operating Expenses
Sales and marketing expenses increased to $4.2 million from $3.8 million in Q1 2024, and research and development expenses rose to $2.3 million from $1.6 million.
Geopolitical and Tariff Uncertainties
Monitoring potential exposure to changes in international trade and tariff policies, though no material impact is expected currently.
Company Guidance
During the BrainsWay First Quarter 2025 earnings call, the company reported a revenue of $11.5 million, marking a 27% increase year-over-year. They shipped 81 Deep TMS systems, a 42% increase from Q1 2024, and maintained a gross margin of 75%. The company has a backlog and remaining performance obligations totaling nearly $60 million, reflecting strong demand and future growth visibility. BrainsWay's full-year 2025 revenue guidance is between $49 million and $51 million, representing a 20% to 24% growth over 2024, with anticipated operating income of 3% to 4% and adjusted EBITDA of 11% to 12%. The company is also focusing on expanding its market presence, enhancing customer engagement through multi-year agreements, and advancing its R&D roadmap to unlock new treatment indications.Brainsway Financial Statement Overview
Summary
Brainsway has shown impressive financial improvement with strong revenue growth, positive net income, and robust balance sheet metrics such as zero debt and significant equity growth. While cash flow generation has improved, historical volatility in earnings and cash flows suggests a need for consistent performance.Income Statement
Brainsway has demonstrated strong revenue growth with a notable increase from $31.785 million in 2023 to $41.016 million in 2024, representing a growth rate of approximately 29%. The company has successfully transitioned from a negative net income in previous years to a positive $2.921 million in 2024. Gross profit margin improved to 74.54% in 2024, indicating efficient cost management. EBIT and EBITDA margins have also turned positive, signaling operational improvements. However, the historical volatility in earnings remains a concern.80
Positive
Balance Sheet
Brainsway's balance sheet is robust, highlighted by zero total debt in 2024 and a substantial increase in stockholders' equity to $62.313 million. The equity ratio stands at a healthy 66.32%, reflecting strong financial stability and low leverage. The company's ample cash reserves of $69.345 million further enhance its financial flexibility. The absence of debt significantly reduces financial risk, but the company should continue to focus on sustainable equity growth.85
Very Positive
Cash Flow
The company's cash flow performance has strengthened, with operating cash flow increasing significantly to $10.23 million in 2024, enabling positive free cash flow of $6.508 million. The operating cash flow to net income ratio is healthy, reflecting efficient cash generation. However, the historical volatility in free cash flow highlights the need for consistent cash flow generation. The improvement in free cash flow from negative figures in prior years is a positive trend.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 41.02M | 31.79M | 27.18M | 29.66M | 22.06M | Gross Profit |
| 30.58M | 23.48M | 20.05M | 23.06M | 17.00M | EBIT |
| 1.39M | -4.96M | -12.68M | -5.00M | -4.83M | EBITDA |
| 5.47M | -2.31M | -11.45M | -4.67M | -3.46M | Net Income Common Stockholders |
| 2.92M | -4.20M | -13.35M | -6.46M | -5.38M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 69.34M | 45.98M | 47.85M | 57.35M | 17.18M | Total Assets |
| 94.32M | 62.97M | 64.48M | 75.73M | 34.01M | Total Debt |
| 5.62M | 471.00K | 488.00K | 754.00K | 429.00K | Net Debt |
| -63.72M | -10.05M | -47.09M | -16.17M | -16.53M | Total Liabilities |
| 31.67M | 21.39M | 19.08M | 18.41M | 14.38M | Stockholders Equity |
| 62.31M | 41.58M | 45.40M | 57.32M | 19.63M |
| Cash Flow | Free Cash Flow | |||
| 6.50M | -1.10M | -7.82M | -1.35M | -3.91M | Operating Cash Flow |
| 10.30M | 1.28M | -9.76M | 884.00K | -1.44M | Investing Cash Flow |
| 30.31M | -37.41M | 42.17M | -42.22M | -2.46M | Financing Cash Flow |
| 18.26M | -1.03M | -1.55M | 41.52M | -1.03M |
Brainsway Technical Analysis
Positive
10.19
Price Trends
9.31
Positive
9.78
Positive
9.47
Positive
Market Momentum
0.35
Positive
55.93
Neutral
20.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BWAY, the sentiment is Positive. The current price of 10.19 is above the 20-day moving average (MA) of 9.95, above the 50-day MA of 9.31, and above the 200-day MA of 9.47, indicating a bullish trend. The MACD of 0.35 indicates Positive momentum. The RSI at 55.93 is Neutral, neither overbought nor oversold. The STOCH value of 20.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BWAY.
Brainsway Risk Analysis
Brainsway disclosed 67 risk factors in its most recent earnings report. Brainsway reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 2 New Risks
1.
The price of our ADSs may rely on the research and reports of equity research analysts Q4, 2023
2.
We may be unable to manage our anticipated growth effectively, which could make it difficult to execute our business strategy and we may even be unable to forecast our future growth accurately. Q4, 2023
Brainsway Peers Comparison
Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $199.94M | 47.18 | 7.41% | ― | 26.86% | ― | |
53 Neutral | $5.23B | 3.23 | -44.27% | 2.82% | 16.82% | 0.11% | |
53 Neutral | $105.42M | ― | -35.68% | ― | 69.17% | 39.01% | |
52 Neutral | $168.95M | ― | -76.01% | ― | 25.62% | 11.86% | |
49 Neutral | $53.72M | ― | -94.65% | ― | -5.86% | 50.76% | |
48 Neutral | $201.12M | ― | -52.87% | ― | -4.16% | 12.79% | |
47 Neutral | $197.14M | ― | 271.41% | ― | 85.03% | 53.73% |
* Healthcare Sector Average
Performance Comparison
BWAY
Brainsway
10.19
3.11
43.93%
CTSO
Cytosorbents
1.00
0.07
7.53%
MYO
Myomo
2.88
-0.61
-17.48%
TLSI
TriSalus Life Sciences
5.19
-1.97
-27.51%
CVRX
CVRx
6.76
-1.93
-22.21%
SGHT
Sight Sciences
4.02
-3.13
-43.78%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.