Irhythm Technologies (IRTC) AI Stock Analysis

• Market Cap: $5.87B
• Dividend Yield: N/A
• Average Volume (3M): 336.40K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.81
• Revenue Growth: 22.37%
• EPS Growth: 31.14%
• Country: US
• Employees: 2,000
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): N/A
• Shares Outstanding: 32,127,760
• 10 Day Avg. Volume: 311,747
• 30 Day Avg. Volume: 336,404
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 7.78
• Enterprise Value/Gross Profit: 11.15
• Enterprise Value/Ebitda: -94.99
• 1Y Price Target: $195.46
• Price Target Upside: 7.00% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 14

• Rating: 60 Neutral
• Price Target: $187.00 ▲(2.37% Upside)

Irhythm Technologies' overall stock score is driven by strong earnings call sentiment and positive technical indicators, offset by weak valuation due to negative profitability metrics. Financial performance shows promise with revenue growth and cash flow improvements, but high leverage and operating expenses remain challenges.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for iRhythm's services, highlighting effective market penetration and product adoption, which supports long-term business sustainability.

International Expansion

International expansion into new markets enhances iRhythm's growth potential and diversifies revenue streams, reducing dependence on domestic markets and increasing global market share.

Strategic Partnerships

Strategic partnerships, like with Lucem Health, leverage AI for proactive care, enhancing product offerings and competitive positioning in the healthcare sector.

Negative Factors

High Leverage

High leverage increases financial risk and limits flexibility, potentially impacting iRhythm's ability to invest in growth and weather economic downturns.

Profitability Challenges

Ongoing profitability challenges, despite strong revenue growth, highlight issues with cost management and operational efficiency, which could hinder long-term financial health.

FDA Remediation Costs

Significant FDA remediation costs add financial burden and could divert resources from growth initiatives, affecting iRhythm's operational focus and profitability.

Irhythm Technologies Business Overview & Revenue Model

Company Description

iRhythm Technologies (IRTC) is a digital healthcare company that specializes in the development of innovative solutions for cardiac monitoring and arrhythmia detection. Operating primarily in the healthcare sector, iRhythm focuses on transforming the way cardiac arrhythmias are diagnosed and managed through its proprietary Zio service, which combines a wearable ECG monitoring device with advanced data analytics and interpretation capabilities. The company's core products include the Zio XT and Zio AT devices, designed to provide continuous cardiac monitoring for patients, enabling clinicians to obtain critical insights into heart health.

How the Company Makes Money

iRhythm Technologies generates revenue primarily through its subscription-based Zio service, which includes the sale of its Zio XT and Zio AT monitoring devices, along with the associated data analysis and reporting services. The company charges healthcare providers for the use of its monitoring devices and the interpretation of the collected data, creating a recurring revenue model. Key revenue streams include direct sales to hospitals and clinics, as well as partnerships with healthcare systems and insurers that facilitate access to its technology. Additionally, iRhythm benefits from collaborations with various healthcare organizations to enhance its product offerings and expand its market presence, further contributing to its earnings.

Irhythm Technologies Financial Statement Overview

Summary

Irhythm Technologies shows strong revenue growth and effective production cost management, but faces challenges in achieving profitability and managing high leverage. Positive cash flow generation is promising, yet reliance on debt financing poses risks.

Income Statement

Irhythm Technologies shows a strong revenue growth with a TTM (Trailing-Twelve-Months) increase of approximately 11% from the previous year. However, the company struggles with profitability, evidenced by its negative net profit margin and EBIT margin, both of which are in the negative territory. The gross profit margin remains healthy above 69%, indicating effective cost management at the production level, but significant operating expenses are impacting overall profitability.

Balance Sheet

The company has a high debt-to-equity ratio of 7.09, indicating high leverage which could pose financial risk. Stockholders' equity is a small fraction of total assets, leading to a low equity ratio of approximately 10.8%. Return on equity is negative due to ongoing losses, highlighting challenges in generating returns for shareholders. Despite these concerns, the company maintains sufficient cash reserves relative to its liabilities.

Cash Flow

Irhythm Technologies has improved its free cash flow position, turning positive in the latest TTM period from a negative position in the previous year. The operating cash flow to net income ratio is positive, suggesting that the company generates adequate cash from its core operations despite reporting net losses. However, the reliance on financing activities to support cash flow needs is notable.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	657.23M	591.84M	492.68M	410.92M	322.82M	265.17M
Gross Profit	458.62M	407.53M	331.81M	281.63M	213.57M	194.89M
EBITDA	-53.84M	-74.13M	-96.86M	-92.14M	-83.23M	-29.15M
Net Income	-92.43M	-113.29M	-123.41M	-116.16M	-101.36M	-43.83M
Balance Sheet
Total Assets	964.03M	931.45M	433.14M	448.22M	462.97M	511.74M
Cash, Cash Equivalents and Short-Term Investments	545.54M	535.55M	133.76M	213.14M	239.13M	335.22M
Total Debt	734.74M	736.91M	129.82M	131.04M	117.71M	122.47M
Total Liabilities	860.37M	840.54M	223.05M	208.41M	183.45M	170.13M
Stockholders Equity	103.66M	90.91M	210.10M	239.81M	279.51M	341.61M
Cash Flow
Free Cash Flow	27.88M	-30.55M	-90.53M	-52.84M	-65.82M	-27.31M
Operating Cash Flow	63.35M	3.39M	-50.10M	-23.01M	-37.75M	-13.76M
Investing Cash Flow	-316.55M	-122.98M	-1.21M	-52.43M	105.26M	-132.39M
Financing Cash Flow	11.78M	511.38M	8.82M	26.72M	-28.58M	214.32M

Irhythm Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 182.67
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IRTC, the sentiment is Positive. The current price of 182.67 is above the 20-day moving average (MA) of 178.01, above the 50-day MA of 175.64, and above the 200-day MA of 137.73, indicating a bullish trend. The MACD of 2.25 indicates Negative momentum. The RSI at 58.56 is Neutral, neither overbought nor oversold. The STOCH value of 65.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IRTC.

Irhythm Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AXGN	―	$831.91M	―	-4.48%	―	17.17%	72.68%
INSP	―	$2.29B	45.30	8.07%	―	22.05%	785.52%
ITGR	―	$2.55B	29.39	5.18%	―	7.81%	-26.32%
IRTC	―	$5.87B	―	-91.13%	―	22.37%	31.14%
LIVN	―	$2.94B	―	-17.87%	―	8.57%	-1154.64%
BVS	―	$573.79M	―	-0.10%	―	5.08%	99.38%
Sector *	―	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Irhythm Technologies Corporate Events

iRhythm Technologies Reports Strong Q2 2025 Earnings

The recent earnings call for iRhythm Technologies was marked by an overwhelmingly positive sentiment, highlighting the company’s robust revenue growth, record-breaking new account openings, and successful international expansion. Despite facing some challenges, such as ongoing FDA remediation costs and a slightly negative free cash flow, the company conveyed a strong sense of optimism for its future trajectory.

iRhythm Technologies Reports Strong Q2 2025 Growth

iRhythm Technologies, Inc. is a digital healthcare company that specializes in developing solutions for detecting, predicting, and preventing diseases, primarily focusing on cardiac monitoring through wearable biosensors and data analytics.