Brainsway (BWAY) AI Stock Analysis

• Market Cap: ₪1.43B
• Dividend Yield: N/A
• Average Volume (3M): 85.46K
• Price to Earnings (P/E): 60.7
• Beta (1Y): -0.05
• Revenue Growth: 21.13%
• EPS Growth: 251.25%
• Country: IL
• Employees: 120
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): 13.80
• Shares Outstanding: 39,170,937
• 10 Day Avg. Volume: 88,081
• 30 Day Avg. Volume: 85,462
• PEG Ratio: -0.33
• Price to Book (P/B): 2.56
• Price to Sales (P/S): 3.88
• P/FCF Ratio: 24.49
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 77 Outperform
• Price Target: 4,220.00 ▲(13.50% Upside)

Score is driven by a strong financial turnaround (profitability, cash generation, and low leverage) and an upbeat earnings call with raised guidance and strong demand signals. The main offsets are a demanding valuation (high P/E) and technically overbought momentum that increases near-term pullback risk.

Positive Factors

Strong cash generation & low leverage

Robust FCF conversion and very low leverage provide durable financial flexibility. This reduces reliance on external financing, funds product rollouts and minority investments, and gives the company a cash cushion to absorb cyclical stress or invest in growth without compromising the balance sheet.

Expanding installed base and system shipments

Rapid shipment growth and a >1,600 system installed base create a durable recurring-revenue platform. Larger installed footprint drives session revenue, clinician familiarity, referral flows and lower marginal customer acquisition costs, supporting sustainable revenue growth over time.

Regulatory approval and payer coverage expansion

FDA approval of an accelerated protocol combined with payer policy expansions (Optum/Premera) are structural enablers. Faster treatment protocols improve patient convenience and throughput; wider insurance coverage expands the addressable market and supports long-term adoption and utilization.

Negative Factors

Short track record of sustained profitability

The recent profitability inflection is meaningful but recent after multi-year losses. A limited track record raises execution risk: slower growth or margin pressure could revert results, testing management's ability to maintain operating leverage and capital allocation through a full cycle.

Rising operating expense base

Higher S&M and R&D outlays support growth and product development but raise the fixed cost base. If revenue growth decelerates, these elevated operating expenses could compress margins and delay achievement of targeted operating leverage, making profitability more sensitive to demand shocks.

Partner regulatory delay risk

A partner's delayed FDA clearance creates timing and revenue visibility risk for anticipated collaborative or complementary offerings. Such regulatory setbacks can postpone market expansion, reduce potential referral or bundled sales, and weaken near-term growth assumptions tied to partnerships.

Brainsway Business Overview & Revenue Model

Company Description

Brainsway Ltd. develops and sells noninvasive neurostimulation treatments for mental health disorders in the United States, Europe, Israel, and internationally. It offers Deep Transcranial Magnetic Stimulation platform technology for the treatment of major depressive disorders, anxious depression, obsessive-compulsive disorders, smoking addiction, bipolar disorders, post traumatic stress disorders, schizophrenia, Alzheimer's disease, autism, chronic pain, multiple sclerosis, post stroke rehabilitation, and Parkinson's diseases. The company primarily serves doctors, hospitals, and medical centers in the field of psychiatry. Brainsway Ltd. was founded in 2003 and is headquartered in Jerusalem, Israel.

How the Company Makes Money

Brainsway generates revenue primarily through the sale and leasing of its dTMS systems to healthcare providers, including hospitals and clinics. The company also earns income from the sale of treatment sessions, which are billed as patients undergo therapy using their equipment. Additionally, Brainsway may enter into partnerships with healthcare institutions for research and development, which can provide funding and enhance its product offerings. The growing recognition of dTMS as a viable treatment option for mental health disorders contributes to Brainsway's earnings, alongside potential reimbursement from insurance providers for the treatments administered.

Brainsway Financial Statement Overview

Summary

Strong financial turnaround with solid TTM profitability (net margin ~12.7%), high gross margin (~75%), improving operating leverage (EBIT ~14.7%, EBITDA ~18.6%), robust cash generation (FCF 18.3M; ~82% of net income), and low leverage (debt-to-equity ~0.10). Main risk is the short track record of the improved earnings profile after volatility and losses in 2022–2023.

Income Statement

TTM (Trailing-Twelve-Months) results show a clear profitability inflection: revenue of 49.1M with strong gross margin (~75%) and improved bottom-line profitability (net margin ~12.7%) versus 2024 (~7.1%) and losses in 2022–2023. Revenue growth in TTM is strong (~6.5%), and margins (EBITDA ~18.6%, EBIT ~14.7%) indicate improving operating leverage. Key weakness is that the historical earnings profile has been volatile (significant losses as recently as 2022–2023), so the durability of the new profit level still needs to be proven through a full cycle.

Balance Sheet

The balance sheet is conservatively positioned with low leverage: TTM debt-to-equity is ~0.10, supported by sizeable equity (70.1M) and assets (113.1M). Returns have improved meaningfully with TTM return on equity near ~9.5% (up from ~4.7% in 2024 and negative in prior loss years). Main drawback is that the stronger return profile is relatively recent, and earlier periods of negative profitability highlight potential sensitivity if growth or margins soften.

Cash Flow

Cash generation is a notable strength in TTM (operating cash flow 22.3M; free cash flow 18.3M), reflecting healthy conversion of earnings into cash (free cash flow is ~82% of net income). The company has also moved decisively away from the negative free cash flow seen in 2020–2023. Weaknesses include slightly negative TTM free-cash-flow growth (~-2.1%) and some year-to-year variability in cash performance historically.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	49.09M	41.02M	31.79M	27.18M	29.66M	22.06M
Gross Profit	36.78M	30.58M	23.48M	20.05M	23.06M	17.00M
EBITDA	9.11M	5.36M	-2.56M	-11.45M	-4.67M	-3.46M
Net Income	6.25M	2.92M	-4.20M	-13.35M	-6.46M	-5.38M
Balance Sheet
Total Assets	113.06M	94.32M	62.97M	64.48M	75.73M	34.01M
Cash, Cash Equivalents and Short-Term Investments	70.46M	69.34M	45.98M	47.85M	57.35M	17.18M
Total Debt	6.75M	5.62M	471.00K	488.00K	754.00K	429.00K
Total Liabilities	43.00M	32.00M	21.39M	19.08M	18.41M	14.38M
Stockholders Equity	70.06M	62.31M	41.58M	45.40M	57.32M	19.63M
Cash Flow
Free Cash Flow	18.34M	6.50M	-1.10M	-7.82M	-1.35M	-3.91M
Operating Cash Flow	22.27M	10.30M	1.28M	-9.76M	884.00K	-1.44M
Investing Cash Flow	-18.30M	30.31M	-37.41M	42.17M	-42.22M	-2.46M
Financing Cash Flow	18.36M	18.26M	-1.03M	-1.55M	41.52M	-1.03M

Brainsway Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3718.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:BWAY, the sentiment is Neutral. The current price of 3718 is below the 20-day moving average (MA) of 3718.90, above the 50-day MA of 3213.42, and above the 200-day MA of 2451.73, indicating a neutral trend. The MACD of 134.79 indicates Positive momentum. The RSI at 52.73 is Neutral, neither overbought nor oversold. The STOCH value of 32.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IL:BWAY.

Brainsway Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BWAY	77 Outperform	₪1.43B	60.68	10.95%	―	21.13%	251.25%
SOFW	64 Neutral	₪1.29B	636.43	―	―	29.55%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%