Spectral AI (MDAI) AI Stock Analysis

• Market Cap: $46.34M
• Dividend Yield: N/A
• Average Volume (3M): 541.41K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.74
• Revenue Growth: -15.02%
• EPS Growth: -11.06%
• Country: US
• Employees: 78
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.13
• Shares Outstanding: 30,688,894
• 10 Day Avg. Volume: 339,515
• 30 Day Avg. Volume: 541,410
• PEG Ratio: 0.08
• Price to Book (P/B): -7.00
• Price to Sales (P/S): 1.72
• P/FCF Ratio: -5.52
• Enterprise Value/Market Cap: 1.28
• Enterprise Value/Revenue: 2.55
• Enterprise Value/Gross Profit: 5.68
• Enterprise Value/Ebitda: -4.64
• 1Y Price Target: $4.50
• Price Target Upside: 214.69% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): -0.42
• Revenue Forecast (FY): $20.15M

• Rating: 45 Neutral
• Price Target: ―

Spectral AI shows significant revenue growth and strategic technological developments, yet faces substantial financial challenges with negative profitability and high leverage. Technical indicators suggest bearish momentum, and the valuation appears unattractive due to the negative P/E ratio. The earnings call presents a mixed outlook, highlighting achievements but also projecting revenue declines, contributing to a cautious overall assessment.

Positive Factors

Revenue Growth

Significant revenue growth in R&D indicates strong demand and successful execution of contracts, enhancing long-term financial prospects.

Technological Advancements

Superior technology performance strengthens competitive advantage and supports market expansion, driving sustainable growth.

Strategic Financing

Securing significant financing supports U.S. market entry and operational growth, enhancing the company's long-term competitive position.

Negative Factors

Financial Instability

High leverage and negative equity indicate financial instability, posing risks to long-term sustainability and operational flexibility.

Profitability Challenges

Persistent profitability issues highlight operational inefficiencies, impacting the company's ability to generate sustainable earnings.

Cash Flow Challenges

Ongoing cash flow challenges limit financial flexibility and may hinder the company's ability to invest in growth opportunities.

Spectral AI Business Overview & Revenue Model

Company Description

Spectral AI, Inc. (MDAI) is a technology-driven company specializing in the development of artificial intelligence (AI) solutions for the medical industry. The company's core product, the DeepView Wound Imaging System, leverages AI to provide healthcare professionals with real-time insights into wound healing and treatment efficacy, primarily focusing on burn and diabetic foot ulcers. Spectral AI aims to enhance patient outcomes and streamline clinical decision-making processes through cutting-edge imaging technology.

How the Company Makes Money

Spectral AI generates revenue primarily through the sale and licensing of its DeepView Wound Imaging System to healthcare providers and institutions. The company may also engage in strategic partnerships with medical device manufacturers and healthcare organizations to expand the reach and adoption of its technology. Additionally, Spectral AI may receive funding from research grants and collaborations with government and private entities interested in advancing AI-driven medical solutions. The company's ability to commercialize its technology and secure long-term contracts with healthcare providers is a significant factor contributing to its earnings.

Spectral AI Financial Statement Overview

Summary

Spectral AI experienced significant revenue growth in 2024, but persistent losses and a precarious balance sheet with high leverage and negative cash flows indicate financial instability. The company's financial health is challenged, necessitating strategic shifts for sustainable profitability and stability.

Income Statement

Spectral AI's revenue in 2024 increased by 63.8% compared to 2023, but this growth has not translated into profitability as evidenced by the negative Net Profit Margin of -51.8% and a significant EBIT Margin of -122.2%. Gross Profit Margin stands at 44.9%, indicating some efficiency in managing production costs. However, the consistent negative EBITDA highlights ongoing challenges in operational profitability.

Balance Sheet

The company is highly leveraged with a negative Stockholders' Equity of -$7.251 million in 2024, resulting in an undefined Debt-to-Equity ratio. The equity ratio is negative, reflecting more liabilities than assets. This financial structure indicates significant financial instability and potential liquidity risk.

Cash Flow

Spectral AI's cash flow indicates challenging conditions, with a negative Free Cash Flow of -$9.199 million in 2024, albeit an improvement from 2023. The Operating Cash Flow to Net Income ratio is challenging, indicating a reliance on external financing as seen in the positive financing cash flow of $9.575 million.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	23.17M	29.58M	18.06M	25.37M	15.24M
Gross Profit	10.43M	13.27M	7.88M	10.84M	7.05M
EBITDA	-12.76M	-11.49M	-20.12M	-2.08M	-4.18M
Net Income	-16.36M	-15.31M	-20.85M	-2.91M	-3.99M
Balance Sheet
Total Assets	15.30M	12.10M	10.69M	18.72M	18.54M
Cash, Cash Equivalents and Short-Term Investments	10.49M	5.16M	4.79M	14.17M	16.12M
Total Debt	9.66M	4.69M	1.29M	1.20M	583.00K
Total Liabilities	23.50M	19.35M	12.40M	6.72M	4.79M
Stockholders Equity	-8.20M	-7.25M	-1.71M	12.00M	13.75M
Cash Flow
Free Cash Flow	-4.40M	-9.20M	-13.24M	-1.16M	-2.92M
Operating Cash Flow	-6.90M	-9.20M	-13.24M	-1.16M	-2.92M
Investing Cash Flow	0.00	0.00	0.00	0.00	-7.00K
Financing Cash Flow	13.68M	9.57M	3.84M	-785.00K	13.92M

Spectral AI Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.43
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MDAI, the sentiment is Negative. The current price of 1.43 is below the 20-day moving average (MA) of 1.65, below the 50-day MA of 2.04, and below the 200-day MA of 1.90, indicating a bearish trend. The MACD of -0.16 indicates Negative momentum. The RSI at 36.53 is Neutral, neither overbought nor oversold. The STOCH value of 77.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MDAI.

Spectral AI Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SRTS	64 Neutral	$68.82M	―	-5.71%	―	-13.79%	-132.21%
NMTC	53 Neutral	$36.14M	-4.57	-95.39%	―	145.48%	67.36%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
ICCM	45 Neutral	$49.12M	-2.80	-157.91%	―	-18.96%	8.98%
MDAI	45 Neutral	$46.34M	―	―	―	-15.02%	-11.06%
LUNG	44 Neutral	$70.08M	-1.20	-73.73%	―	15.59%	4.13%
CTSO	42 Neutral	$47.10M	―	-96.15%	―	-8.97%	47.29%

Spectral AI Corporate Events

Spectral AI Enhances CFO Compensation Amidst Growth

On March 26, 2025, Spectral AI’s Board of Directors approved an amendment to CFO Vincent Capone’s employment agreement, enhancing his compensation and stock options. The company announced its 2024 financial results, highlighting a significant increase in R&D revenue due to its BARDA PBS contract. Spectral AI is advancing its DeepView System for regulatory approval in the US, supported by successful burn validation study results. The company is on track to submit regulatory filings for its burn indication and anticipates FDA clearance in early 2026, with commercial product revenue expected in the second half of 2025.

Spectral AI Secures $15M Financing for U.S. Expansion

On March 21, 2025, Spectral AI, Inc. completed a securities purchase agreement and a debt financing transaction, raising a total of $2.7 million from equity financing and securing up to $15 million in debt financing from Avenue Venture Opportunities Fund II, L.P. The funds will support the commercialization of its DeepView System in the U.S. market. The financing includes an initial draw of $8.5 million and potential additional debt contingent upon FDA clearance and further equity raise. This financial boost is expected to accelerate Spectral AI’s market entry and enhance its operational capabilities, positioning the company for growth and innovation in the medical diagnostics industry.

Spectral AI Announces Successful Burn Study Results

On March 17, 2025, Spectral AI announced the successful results of its Burn Validation Study for the DeepView System, which uses multi-spectral imaging and AI algorithms to predict burn healing potential. The study, conducted from January 2024 to March 2025, involved 164 patients and demonstrated that the DeepView System significantly outperformed burn physicians in identifying non-healing tissue. With plans to submit these results to the FDA by mid-2025, Spectral AI aims for De Novo Clearance and rapid commercialization, potentially transforming burn care by providing faster and more accurate treatment insights.