Rockwell Medical On Course To Reach Profitability By Late 2024, Analyst Says

H.C. Wainwright analyst Raghuram Selvaraju reiterated a Buy rating on Rockwell Medical, Inc. RMTI, raising the price target to $11 from $9.

Earlier this month, Rockwell Medical reported that it had agreed to acquire a hemodialysis concentrates business from privately-held Evoqua Water Technologies.

The business that Rockwell is purchasing has annualized revenues of roughly $18 million and is slated to add about $3.3 million in EBITDA to Rockwell's income statement, the analyst notes.

There is potential for Rockwell Medical to attain operating cash flow break-even during 2024 and reach profitability in late 2024, Selvaraju adds.

The analyst thinks the company could position itself as one of the top two hemodialysis concentrates suppliers in the US following this acquisition. 

The company continues to target $100 million in top-line revenue near term, which the analyst thinks can be attained next year.

In the wake of the buyout, the analyst estimates full-year 2023 revenues to come in at approximately $86 million vs. the previous $81.5 million.

Selvaraju raised 2024 revenue estimates to $103 million from the previous estimate of $99 million. 

The analyst expects the full-year 2023 net loss per share to total $(0.35) vs. the previous estimate of a net loss of $(0.41) per share.

The analyst forecasts a 2024 net loss of only $(0.08) per share vs. the previous estimate of a net loss of $(0.23) per share.

Price Action: RMTI shares are trading higher by 24% to $3.96 on the last check Monday.