OrthoPediatrics: Strengthening Fundamentals, Sustained Double-Digit Growth, and Improving Cash Generation Support Buy Rating

Analyst Michael Matson of Needham maintained a Buy rating on OrthoPediatrics, retaining the price target of $26.00.

Michael Matson has given his Buy rating due to a combination of factors pointing to solid growth and improving fundamentals at OrthoPediatrics. The company raised its 2025 revenue outlook above both its prior guidance and Wall Street expectations, with particularly strong anticipated growth in both domestic and international markets. Fourth quarter 2025 revenue is also projected to outpace consensus, underscoring sustained demand momentum. In addition, OrthoPediatrics achieved meaningful free cash flow generation in 4Q25 and significantly reduced its annual cash burn versus 2024, signaling improving financial discipline and a stronger balance sheet profile.

Michael Matson’s positive stance is further supported by OrthoPediatrics’ progress on product and regulatory milestones, including new EU MDR certifications across multiple spine and trauma product lines, which should support international expansion and long-term growth. Management’s 2026 revenue guidance implies continued double-digit top-line growth, and while projected EBITDA is slightly below consensus, it still reflects improving profitability. The planned reduction in capital deployed for instrument sets in 2026 also suggests the business can grow more efficiently going forward. Collectively, these dynamics underpin Matson’s view that OrthoPediatrics offers an attractive risk-reward profile at current levels, justifying his Buy rating.