Brainsway (BWAY) AI Stock Analysis

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Brainsway

(OTC:BWAY)

Rating:78Outperform

Price Target:

2,883.00

▲(14.00% Upside)

Brainsway's strong financial performance and bullish technical indicators are the primary drivers of its high stock score. The company's robust revenue growth and strategic investments are positive, though the high P/E ratio and pending regulatory approvals pose some risks. Overall, the stock is well-positioned for growth, but investors should be mindful of valuation concerns and potential regulatory hurdles.

Brainsway (BWAY) vs. iShares MSCI Israel ETF (EIS)

Market Cap

$902.37M

Dividend YieldN/A

Average Volume (3M)53.28K

Price to Earnings (P/E)48.5

Beta (1Y)0.30

Revenue Growth23.45%

EPS Growth670.44%

CountryIL

Employees120

SectorHealthcare

Sector Strength50

IndustryMedical - Devices

Share Statistics

EPS (TTM)19.20

Shares Outstanding37,803,593

10 Day Avg. Volume78,758

30 Day Avg. Volume53,285

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap0.66

Enterprise Value/Revenue13.01

Enterprise Value/Gross Profit17.46

Enterprise Value/Ebitda70.85

Forecast

1Y Price Target

$2,693.11

Price Target Upside6.49% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering0

Brainsway Business Overview & Revenue Model

Company DescriptionBrainsway (BWAY) is a medical technology company specialized in developing advanced non-invasive neurostimulation treatments for mental health and neurological disorders. Operating within the healthcare sector, Brainsway primarily focuses on its flagship product, Deep Transcranial Magnetic Stimulation (Deep TMS), which has been cleared by the FDA for the treatment of major depressive disorder, obsessive-compulsive disorder, and smoking cessation. The company's technology is designed to stimulate deep and broad areas of the brain, offering a new approach to addressing complex mental health conditions.

How the Company Makes MoneyBrainsway generates revenue primarily through the sale and leasing of its Deep TMS systems to healthcare providers, clinics, and hospitals. The company offers a capital sales model where institutions purchase the Deep TMS systems outright, and a leasing model where organizations can access the equipment through a subscription or rental agreement. Additionally, Brainsway earns income from ongoing treatment sessions, as healthcare providers utilize the systems to treat patients. Significant partnerships with medical institutions and continuous innovation in treatment protocols further contribute to its revenue streams, enhancing the adoption and utilization of its technology in various markets.

Brainsway Earnings Call Summary

Earnings Call Date:Aug 13, 2025

(Q2-2025)

% Change Since: 21.24%|

Next Earnings Date:Nov 12, 2025

Earnings Call Sentiment Positive

The earnings call highlights significant revenue growth, strong market presence, and strategic investments, suggesting positive momentum despite increased operating expenses and pending regulatory approvals.

Q2-2025 Updates

Positive Updates

Record Quarterly Revenue

BrainsWay reported record quarterly revenue of $12.6 million for Q2 2025, a 26% increase compared to the same period last year.

Significant Growth in Deep TMS System Shipments

The company shipped 88 Deep TMS systems during the quarter, representing a 35% increase compared to the same period last year, bringing the total installed base to 1,522 systems.

Strong Gross Margin and Recurring Revenue

The company maintained a strong gross margin of 75%, and 70% of customer engagements are now through multiyear lease agreements, providing stability and visibility into future revenues.

Expansion Through Strategic Investments

BrainsWay made a $5 million investment in Stella MSO as part of a strategy to invest in mental health providers, supported by a $20 million strategic equity investment from Valor Equity Partners.

Strong Cash Position and Increased Revenue Guidance

The company ended the quarter with $78.3 million in cash and raised full-year 2025 revenue guidance to $50-$52 million, representing 22%-27% growth over 2024.

Negative Updates

Increased Operating Expenses

Sales and marketing expenses increased by $1.1 million to $4.9 million, and R&D expenses increased by $0.6 million to $2.3 million, primarily due to ongoing clinical trials and development activities.

Pending Regulatory Approval

Approval for the accelerated Deep TMS protocol from the FDA is pending, with potential clearance expected by the end of the year.

Company Guidance

During the BrainsWay Second Quarter 2025 Earnings Conference Call, the company reported record quarterly revenue of $12.6 million, a 26% increase from the same period last year. They shipped 88 Deep TMS systems, marking a 35% increase year-over-year, bringing the total installed base to 1,522 systems. Multiyear lease agreements now account for 70% of customer engagement, with a backlog of $62 million in signed agreements. Gross profit for the quarter was $9.5 million with a 75% gross margin. Operating expenses rose due to increased sales, marketing, and R&D investments. The company raised its full-year 2025 revenue guidance to $50-$52 million, expecting operating profit in the range of 4% to 5% of revenue and adjusted EBITDA of 12% to 13%.

Brainsway Financial Statement Overview

Summary

Brainsway demonstrates significant financial improvement across all metrics. Revenue and profitability have increased markedly, supported by strong margins and efficient cost management. The balance sheet is healthy, with low leverage and a strong equity position. Cash flow generation is robust, further enhancing financial stability. The company is well-positioned for future growth and operational efficiency.

Income Statement

Positive

Brainsway's income statement shows a strong upward trajectory in revenue, with a recent annual increase of 29.06%. The gross profit margin is high at 74.56%, indicating effective cost management. The net profit margin turned positive to 7.12% after consecutive losses in prior years, demonstrating substantial improvement. EBIT and EBITDA margins are also positive, reflecting operational efficiency gains.

Balance Sheet

Positive

The balance sheet reflects a strong equity ratio of 66.05%, suggesting financial stability. The debt-to-equity ratio is low at 0.09, indicating minimal leverage and low financial risk. Return on equity is 4.69%, showing positive shareholder returns, though there is room for improvement. Overall, the balance sheet is solid with a focus on equity over debt.

Cash Flow

Positive

Cash flow analysis reveals robust growth, with a free cash flow growth rate of 689.89%, showcasing strong operational performance and cash generation. The operating cash flow to net income ratio is 3.53, highlighting efficient cash conversion. Free cash flow to net income ratio is 2.23, indicating healthy free cash flow relative to net income. The company exhibits strong cash flow generation and management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	46.08M	41.02M	31.79M	27.18M	29.66M	22.06M
Gross Profit	34.34M	30.58M	23.48M	20.05M	23.06M	17.00M
EBITDA	8.46M	5.36M	-2.56M	-11.45M	-4.67M	-3.46M
Net Income	5.34M	2.92M	-4.20M	-13.35M	-6.46M	-5.38M
Balance Sheet
Total Assets	111.56M	94.32M	62.97M	64.48M	75.73M	34.01M
Cash, Cash Equivalents and Short-Term Investments	78.00M	69.34M	45.98M	47.85M	57.35M	17.18M
Total Debt	6.13M	5.62M	471.00K	488.00K	754.00K	429.00K
Total Liabilities	43.43M	32.00M	21.39M	19.08M	18.41M	14.38M
Stockholders Equity	68.13M	62.31M	41.58M	45.40M	57.32M	19.63M
Cash Flow
Free Cash Flow	18.73M	6.50M	-1.10M	-7.82M	-1.35M	-3.91M
Operating Cash Flow	23.16M	10.30M	1.28M	-9.76M	884.00K	-1.44M
Investing Cash Flow	-21.00M	30.31M	-37.41M	42.17M	-42.22M	-2.46M
Financing Cash Flow	17.87M	18.26M	-1.03M	-1.55M	41.52M	-1.03M

Brainsway Technical Analysis

Technical Analysis Sentiment

Positive

Last Price2529.00

Price Trends

50DMA

2095.02

Positive

100DMA

1901.31

Positive

200DMA

1863.65

Positive

Market Momentum

MACD

79.69

Negative

RSI

81.48

Negative

STOCH

93.47

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:BWAY, the sentiment is Positive. The current price of 2529 is above the 20-day moving average (MA) of 2098.25, above the 50-day MA of 2095.02, and above the 200-day MA of 1863.65, indicating a bullish trend. The MACD of 79.69 indicates Negative momentum. The RSI at 81.48 is Negative, neither overbought nor oversold. The STOCH value of 93.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:BWAY.

Brainsway Peers Comparison

Overall Rating

UnderperformOutperform

Sector (51)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BWAY	78 Outperform	$902.37M	48.50	9.62%	―	23.45%	670.44%
SOFW	65 Neutral	1.09B	―		―	22.30%	59.78%
Sector *	51 Neutral	$7.73B	-0.08	-40.59%	2.23%	22.72%	-1.44%

* Healthcare Sector Average

Performance Comparison

IL:BWAY

Brainsway

2,529.00

1,139.00

81.94%

IL:SOFW

Sofwave

3,012.00

1,336.00

79.71%

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.Date of analysis: Aug 20, 2025