NeuroPace (NPCE) AI Stock Analysis

• Market Cap: $346.69M
• Dividend Yield: N/A
• Average Volume (3M): 144.25K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.82
• Revenue Growth: 23.32%
• EPS Growth: 23.29%
• Country: US
• Employees: 184
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.26
• Shares Outstanding: 33,081,497
• 10 Day Avg. Volume: 123,108
• 30 Day Avg. Volume: 144,250
• 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: 1.08
• Enterprise Value/Revenue: 4.24
• Enterprise Value/Gross Profit: 5.60
• Enterprise Value/Ebitda: -23.14
• 1Y Price Target: $16.67
• Price Target Upside: 59.06% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 52 Neutral
• Price Target: $10.50 ▲(0.19% Upside)

NeuroPace's stock score is driven by strong revenue growth and positive earnings call highlights, such as improved gross margins and successful debt refinancing. However, financial risks from high debt levels and negative cash flow, along with valuation concerns due to ongoing losses, weigh down the score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand for NeuroPace's RNS System, enhancing its competitive position and supporting long-term business expansion.

Gross Margin Improvement

Improved gross margins reflect operational efficiency and pricing power, contributing to better profitability and financial health over time.

Successful Debt Refinancing

Refinancing debt on better terms reduces financial risk and provides the company with increased flexibility to invest in growth initiatives.

Negative Factors

High Debt Levels

High debt levels can strain cash flow and limit financial flexibility, potentially impacting long-term stability and operational capacity.

Negative Cash Flow

Negative cash flow suggests challenges in generating sufficient cash from operations, which may hinder the ability to fund growth and meet financial obligations.

Increased Operating Expenses

Rising operating expenses can pressure margins and profitability, necessitating careful cost management to sustain financial health.

NeuroPace Business Overview & Revenue Model

Company Description

NeuroPace, Inc. operates as a medical device company in the United States. It develops and sells RNS system, a brain-responsive neuromodulation system for treating medically refractory focal epilepsy by delivering personalized real-time treatment at the seizure source. The company's RNS system also records continuous brain activity data; and enables clinicians to monitor patients in person and remotely. It sells its products to hospital facilities for initial RNS system implant procedures and for replacement procedures. The company was incorporated in 1997 and is headquartered in Mountain View, California.

How the Company Makes Money

NeuroPace generates revenue primarily through the sale of its RNS System and its associated services. The company sells its devices to hospitals, clinics, and healthcare providers, who then implant them into eligible patients. Key revenue streams include the initial sale of the RNS System, which comprises the implantable device and the external components, as well as ongoing revenues from patient monitoring services and device maintenance. Partnerships with healthcare institutions and neurologists play a significant role in driving adoption of the RNS System, while reimbursement from insurance providers for the device and its implantation also contributes to the company’s earnings. Additionally, NeuroPace may benefit from research collaborations and clinical studies that validate the effectiveness of its technology, further enhancing its market position.

NeuroPace Financial Statement Overview

Summary

NeuroPace shows positive revenue growth, but faces challenges with profitability and liquidity. High debt levels and negative cash flow indicate financial risk.

Income Statement

NeuroPace shows a positive revenue growth trend with a 22% increase from the previous year. However, the company is facing challenges with profitability as reflected in negative EBIT and net income margins. The gross profit margin remains strong at 74%, but the net profit margin remains at 0%, indicating operational challenges.

Balance Sheet

The company's balance sheet shows a high debt-to-equity ratio due to substantial debt levels, indicating potential financial risk. Equity has significantly decreased, impacting financial stability. The equity ratio is low at about 8%, highlighting reliance on debt financing.

Cash Flow

NeuroPace's free cash flow remains negative, indicating cash constraints. The free cash flow growth shows a slight improvement but remains negative, and the operating cash flow to net income ratio is unfavorable, reflecting cash generation issues relative to reported earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	88.57M	79.91M	65.42M	45.52M	45.18M	41.14M
Gross Profit	67.08M	59.09M	48.12M	32.49M	33.44M	30.27M
EBITDA	-16.22M	-16.57M	-22.83M	-36.57M	-28.37M	-12.48M
Net Income	-17.29M	-27.14M	-32.96M	-47.08M	-36.08M	-24.28M
Balance Sheet
Total Assets	106.11M	94.65M	107.65M	114.11M	133.56M	55.95M
Cash, Cash Equivalents and Short-Term Investments	62.14M	52.76M	66.45M	77.41M	115.58M	38.08M
Total Debt	71.52M	73.34M	72.39M	69.77M	49.85M	52.86M
Total Liabilities	86.68M	86.63M	87.00M	79.33M	60.06M	203.78M
Stockholders Equity	19.44M	8.01M	20.65M	34.78M	73.50M	-6.41M
Cash Flow
Free Cash Flow	-16.23M	-18.25M	-19.87M	-37.47M	-24.96M	-21.67M
Operating Cash Flow	-16.09M	-17.95M	-19.70M	-36.87M	-24.58M	-21.61M
Investing Cash Flow	3.16M	8.99M	23.03M	23.80M	-85.40M	-10.77M
Financing Cash Flow	22.95M	4.33M	8.13M	490.00K	102.53M	55.01M

NeuroPace Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 10.48
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NPCE, the sentiment is Neutral. The current price of 10.48 is below the 20-day moving average (MA) of 10.64, above the 50-day MA of 9.97, and below the 200-day MA of 11.36, indicating a neutral trend. The MACD of 0.15 indicates Positive momentum. The RSI at 52.62 is Neutral, neither overbought nor oversold. The STOCH value of 36.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NPCE.

NeuroPace Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TCMD	―	$336.61M	24.10	7.64%	―	6.15%	-54.24%
DCTH	―	$357.86M	219.56	―	―	251.26%	―
CBLL	―	$472.60M	―	―	―	―	―
NPCE	―	$346.69M	―	-176.94%	―	23.32%	23.29%
Sector *	―	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
RXST	―	$352.29M	―	-11.66%	―	27.68%	20.87%
SENS	―	$285.55M	-3.64	-102.61%	―	5.94%	25.18%

NeuroPace Corporate Events

NeuroPace, Inc. Reports Record Revenue and Strong Margins in Q2 2025 Earnings Call

In the latest earnings call, NeuroPace, Inc. demonstrated a strong performance with record revenue and improved gross margins, despite facing challenges such as increased operating expenses and a higher net loss. The company also shared positive clinical trial data, although the NAUTILUS trial did not meet its primary effectiveness endpoint.

Neuropace’s Innovative Approach to Treating Lennox-Gastaut Syndrome

Neuropace, Inc. is conducting a study titled ‘RNS System Feasibility Study of Thalamocortical Brain-Responsive Neurostimulation for the Treatment of Lennox-Gastaut Syndrome’. The study aims to assess the safety and effectiveness of brain-responsive neurostimulation in reducing generalized seizures in patients aged 12 and older with Lennox-Gastaut Syndrome (LGS) who do not respond to antiseizure medications. This research is significant as it seeks to expand the use of the RNS System for treating medically intractable LGS.

NeuroPace Reports Record Revenue and Raises Guidance

NeuroPace, Inc., based in Mountain View, California, is a medical device company specializing in innovative solutions for epilepsy treatment, notably through its RNS System, a brain-responsive platform that offers personalized, real-time seizure management. In its latest earnings report for the second quarter of 2025, NeuroPace announced a record quarterly revenue of $23.5 million, marking a 22% increase year-over-year. The company also raised its full-year revenue guidance to between $94 million and $98 million, reflecting strong market performance and strategic advancements.