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Avita Medical
(NASDAQ:RCEL)
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Rating:55Neutral
Price Target:
$5.00
▲(8.46% Upside)
Action:Reiterated
Date:08/07/26
The score is held back primarily by weak financial fundamentals—large losses, negative free cash flow, and negative equity—despite strong revenue growth and high gross margins. Offsetting this, the latest earnings call was constructive (raised revenue guidance and a stated path to cash-flow breakeven), and technicals are supportive with price above major moving averages and neutral momentum. Valuation is difficult to assess due to negative earnings and no dividend support.
Positive Factors
High gross margins & consumable-driven model
Sustained ~82% gross margins and a business model that sells single-use consumables per procedure create durable unit economics. High product margins across procedures support long-term profitability potential as site placements scale and recurring consumable demand compounds over time.
Negative Factors
Negative equity and thin capital base
Cumulative losses have driven negative equity and a smaller asset base, constraining balance-sheet resilience. Over the medium term this raises the likelihood of additional capital raises or dilutive financing and limits flexibility to absorb setbacks without external funding.
Read all positive and negative factors
Positive Factors
Negative Factors
High gross margins & consumable-driven model
Sustained ~82% gross margins and a business model that sells single-use consumables per procedure create durable unit economics. High product margins across procedures support long-term profitability potential as site placements scale and recurring consumable demand compounds over time.
Read all positive factors
Avita Medical Key Performance Indicators (KPIs)
Avita Medical (RCEL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$247.72M
Dividend YieldN/A
Average Volume (3M)348.36K
Price to Earnings (P/E)―
Beta (1Y)1.98
Revenue Growth1.00%
EPS Growth26.76%
CountryUS
Employees226
SectorHealthcare
Sector Strength45
IndustryMedical - Devices
Share Statistics
EPS (TTM)-1.45
Shares Outstanding30,926,847
10 Day Avg. Volume309,661
30 Day Avg. Volume348,355
Financial Highlights & Ratios
PEG Ratio0.07
Price to Book (P/B)-5.77
Price to Sales (P/S)1.34
P/FCF Ratio-2.92
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price Target
$9.00Price Target Upside95.23% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
EPS Forecast (FY)-1.05
Revenue Forecast (FY)$82.77M
Avita Medical Business Overview & Revenue Model
Company Description
AVITA Medical, Inc., together with its subsidiaries, operates as a therapeutic acute wound care company in the United States, Japan, the European Union, Australia, and the United Kingdom. The company’s lead product is the RECELL System, a cell har...
How the Company Makes Money
Avita Medical makes money primarily by selling its RECELL System and related consumable components used per patient procedure. Revenue is generated through (1) sales of single-use consumables/kits required to prepare the autologous cell suspension...
Avita Medical Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call conveyed strong commercial momentum: record quarterly revenue, meaningful sequential growth across RECELL (U.S. and international), early traction for Cohealyx, high gross margins (~82%), reduced cash burn, and an upwardly revised FY26 revenue guide with a stated path to cash flow breakeven in Q4 2026. Key risks remain: PermeaDerm is still nascent, the company remains unprofitable with relatively modest cash on hand ($11.1M), access to additional financing is contingent on achieving revenue milestones, and final reimbursement/coding changes (though largely positive) carry implementation risk. Overall, the positives — revenue acceleration, margin strength, improved cash dynamics, and guidance raise — outweigh the remaining execution and financing risks.Positive Updates
Quarterly Revenue Growth and Record Quarter
Q2 FY26 revenue of $21.7 million, up 18% year-over-year and 13% sequentially; first quarter in company history to cross $20 million in revenue; $41 million in revenue for the first half of 2026.
Negative Updates
PermeaDerm Early-Stage Revenue and Adoption
PermeaDerm generated only $600,000 in Q2 with commercial adoption still in early stages; revenue contribution remains small and broader adoption dependent on upcoming PermeaDerm-I post-market study results expected later this year.
Read all updates
Q2-2026 Updates
Positive
Negative
Quarterly Revenue Growth and Record Quarter
Q2 FY26 revenue of $21.7 million, up 18% year-over-year and 13% sequentially; first quarter in company history to cross $20 million in revenue; $41 million in revenue for the first half of 2026.
Read all positive updates
Company Guidance
Management raised full‑year 2026 revenue guidance to $86–$89 million (up from prior $80–85M), implying 20–24% growth over 2025’s $71.6 million, and introduced guidance to reach cash‑flow breakeven and begin generating cash in Q4 2026. In Q2 revenue was $21.7M (+18% YoY, +13% sequential), bringing H1 revenue to $41M and marking two consecutive sequential growth quarters of +9.7% and +13%; gross margin was 81.9% (vs. 81.2% a year ago, >81% YTD) with Cohealyx at ~86% product margin. Product performance included RECELL U.S. revenue of $8.5M in Q2 (+13% seq) and U.S. RECELL volume >2.6k units (+>10% seq) with RECELL GO Mini procedures 77% YTD in wounds ≤500 cm²; Cohealyx revenue was $1.7M (+16% seq) and PermeaDerm $0.6M. Operating expenses were $24.6M (flat vs Q1, down 6% YoY), operating loss $6.9M and net loss $7.7M (improved from $11.1M and $9.9M a year ago), net cash use was about $3.2M in the quarter, ending cash was $11.1M, and an additional $10M tranche from the Perceptive facility is available once trailing‑12‑month revenue reaches $85M; management also cited 55 active VAC reviews (10–15 completed per quarter) and 25 hospitals using all three products.Avita Medical Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
22
Negative
Cash Flow
24
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 75.63M | 71.61M | 64.25M | 50.14M | 34.42M | 33.02M |
| Gross Profit | 61.68M | 58.82M | 55.16M | 42.36M | 28.38M | 26.92M |
| EBITDA | -34.42M | -41.23M | -55.30M | -33.54M | -26.05M | -24.40M |
| Net Income | -43.08M | -48.59M | -61.84M | -35.38M | -26.66M | -25.14M |
Balance Sheet | ||||||
| Total Assets | 47.78M | 56.39M | 79.71M | 111.64M | 98.26M | 116.02M |
| Cash, Cash Equivalents and Short-Term Investments | 11.13M | 18.18M | 35.88M | 89.06M | 79.34M | 85.16M |
| Total Debt | 48.48M | 46.05M | 45.98M | 42.41M | 918.00K | 1.64M |
| Total Liabilities | 75.61M | 73.04M | 75.21M | 62.58M | 13.52M | 11.39M |
| Stockholders Equity | -27.84M | -16.65M | 4.50M | 49.06M | 84.74M | 104.62M |
Cash Flow | ||||||
| Free Cash Flow | -23.59M | -32.93M | -58.27M | -39.46M | -19.61M | -18.52M |
| Operating Cash Flow | -24.23M | -31.20M | -48.94M | -38.01M | -19.09M | -18.04M |
| Investing Cash Flow | 600.00K | 12.45M | 37.36M | 1.61M | -19.33M | -50.21M |
| Financing Cash Flow | 20.55M | 14.94M | 3.51M | 40.37M | 900.00K | 64.06M |
Avita Medical Technical Analysis
Positive
4.61
Price Trends
4.83
Positive
4.59
Positive
4.28
Positive
Market Momentum
0.91
Negative
74.99
Negative
88.31
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCEL, the sentiment is Positive. The current price of 4.61 is below the 20-day moving average (MA) of 5.65, below the 50-day MA of 4.83, and above the 200-day MA of 4.28, indicating a bullish trend. The MACD of 0.91 indicates Negative momentum. The RSI at 74.99 is Negative, neither overbought nor oversold. The STOCH value of 88.31 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RCEL.
Avita Medical Risk Analysis
Avita Medical disclosed 39 risk factors in its most recent earnings report. Avita Medical 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 0 New Risks
Avita Medical Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
62 Neutral | $283.32M | -79.78 | -2.70% | ― | -2.50% | 93.57% | |
55 Neutral | $247.72M | -5.41 | 231.87% | ― | 1.00% | 26.76% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $100.10M | 6.46 | 9999.00% | ― | 3.26% | ― | |
49 Neutral | $84.70M | -1.51 | -177.04% | ― | 16.13% | -11.56% | |
47 Neutral | $182.23M | -15.49 | -50.27% | ― | 28.02% | 87.30% | |
46 Neutral | $196.11M | -2.08 | -1.91% | ― | 24.89% | 55.16% |
* Healthcare Sector Average
RCEL
Avita Medical
7.85
2.22
39.43%
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RPID
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1.68
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LUCD
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0.97
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-5.20%
Avita Medical Corporate Events
Business Operations and StrategyExecutive/Board ChangesPrivate Placements and FinancingShareholder Meetings
Avita Medical Shareholders Approve 2026 Governance and Equity Plans
Positive
Jun 4, 2026
AVITA Medical, Inc. held its 2026 Annual Meeting of Stockholders by live webcast on June 3, 2026, with a quorum of shareholders participating. Investors re-elected all seven directors, ratified Grant Thornton LLP as independent auditor for 2026, a...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.