In a report released on September 12, Patrick Wood from Morgan Stanley maintained a Hold rating on HeartFlow, Inc., with a price target of $35.00.
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Patrick Wood has given his Hold rating due to a combination of factors influencing HeartFlow, Inc.’s current market position and future prospects. Although the company has shown impressive growth since its IPO, with a significant increase in stock value and strong preliminary Q2 results, there are still hurdles to overcome. The company’s sales have increased substantially, and its gross margin has improved due to advancements in image processing times and operational efficiencies.
However, the adoption of HeartFlow’s technology is hindered by organizational challenges that require alignment across various departments within healthcare facilities. Despite the promising outlook for future revenue streams, such as the upcoming Plaque Analysis rollout, and the company’s strategic focus on expanding its installed base, these factors contribute to a cautious approach. The need for a 12-month onboarding cycle and the dependency on building regional commercial infrastructure for global expansion also play a role in the Hold rating. Thus, while HeartFlow is on a positive trajectory, these considerations suggest a balanced view of its stock performance.