NeuroPace (NPCE) AI Stock Analysis

• Market Cap: $431.00M
• Dividend Yield: N/A
• Average Volume (3M): 194.02K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.48
• Revenue Growth: 24.08%
• EPS Growth: 24.08%
• Country: US
• Employees: 184
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.11
• Shares Outstanding: 33,307,735
• 10 Day Avg. Volume: 333,145
• 30 Day Avg. Volume: 194,023
• PEG Ratio: 0.45
• Price to Book (P/B): 40.67
• Price to Sales (P/S): 4.08
• P/FCF Ratio: -17.85
• Enterprise Value/Market Cap: 0.82
• Enterprise Value/Revenue: 3.72
• Enterprise Value/Gross Profit: 4.84
• Enterprise Value/Ebitda: -23.27
• 1Y Price Target: $18.00
• Price Target Upside: 39.10% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): -0.85
• Revenue Forecast (FY): $95.66M

• Rating: 61 Neutral
• Price Target: $14.00 ▲(8.19% Upside)

NeuroPace's overall score is driven by strong earnings call results, highlighting revenue growth and positive EBITDA, which are significant positives. However, financial performance concerns, including high leverage and negative profitability, weigh down the score. Technical indicators show strong momentum, but valuation remains a concern due to negative earnings.

Positive Factors

Revenue Growth

The significant revenue growth indicates strong market demand and successful product adoption, supporting long-term business expansion.

Positive Adjusted EBITDA

Achieving positive adjusted EBITDA demonstrates improved operational efficiency and scalability, enhancing financial stability.

Strong Gross Margins

Sustained high gross margins reflect effective cost management and pricing power, contributing to long-term profitability.

Negative Factors

High Leverage

High leverage can increase financial risk and limit flexibility, potentially impacting the company's ability to invest in growth opportunities.

Negative Profitability

Ongoing profitability challenges may hinder reinvestment in innovation and expansion, affecting long-term competitive positioning.

Extended Timeline for Pediatric Indication

Delays in regulatory submissions can slow product diversification and market expansion, impacting future revenue streams.

NeuroPace Business Overview & Revenue Model

Company Description

NeuroPace, Inc. is a medical technology company focused on developing innovative solutions for neurological disorders, particularly epilepsy. The company operates within the healthcare sector, specializing in the design, manufacturing, and commercialization of neuromodulation devices. Its flagship product, the RNS System, is an implantable device that monitors and responds to abnormal electrical activity in the brain to prevent seizures in patients with drug-resistant epilepsy. NeuroPace aims to improve the quality of life for patients through advanced neurostimulation technology.

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 revenue growth potential with a 7.1% increase in TTM, but struggles with profitability due to negative net profit and EBIT margins. The high debt-to-equity ratio and negative return on equity indicate financial risk, despite improvements in free cash flow.

Income Statement

NeuroPace shows a positive revenue growth trend with a 7.1% increase in TTM, indicating potential market expansion. However, the company struggles with profitability, as evidenced by negative net profit and EBIT margins. The gross profit margin is strong at 76.8%, but the negative net profit margin of -21.6% highlights ongoing challenges in cost management and operational efficiency.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 3.84, indicating significant leverage and potential financial risk. Return on equity is negative, reflecting losses and inefficiencies in generating shareholder value. The equity ratio stands at 17.3%, suggesting a moderate reliance on equity financing.

Cash Flow

Cash flow analysis shows improvement in free cash flow growth, with a notable increase of 91.3% in TTM. The operating cash flow to net income ratio is negative, indicating cash flow challenges. However, the free cash flow to net income ratio is positive, suggesting some ability to cover net losses with free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	94.86M	79.91M	65.42M	45.52M	45.18M	41.14M
Gross Profit	72.83M	59.09M	48.12M	32.49M	33.44M	30.27M
EBITDA	-15.16M	-16.57M	-22.83M	-36.57M	-28.37M	-12.48M
Net Income	-23.99M	-27.14M	-32.96M	-47.08M	-36.08M	-24.28M
Balance Sheet
Total Assets	107.25M	94.65M	107.65M	114.11M	133.56M	55.95M
Cash, Cash Equivalents and Short-Term Investments	60.01M	52.76M	66.45M	77.41M	115.58M	38.08M
Total Debt	71.18M	73.34M	72.39M	69.77M	49.85M	52.86M
Total Liabilities	88.74M	86.63M	87.00M	79.33M	60.06M	203.78M
Stockholders Equity	18.52M	8.01M	20.65M	34.78M	73.50M	-147.83M
Cash Flow
Free Cash Flow	-16.58M	-18.25M	-19.87M	-37.47M	-24.96M	-21.67M
Operating Cash Flow	-16.31M	-17.95M	-19.70M	-36.87M	-24.58M	-21.61M
Investing Cash Flow	1.73M	8.99M	23.03M	23.80M	-85.40M	-10.77M
Financing Cash Flow	19.81M	4.33M	8.13M	490.00K	102.53M	55.01M

NeuroPace Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12.94
• 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 NPCE, the sentiment is Positive. The current price of 12.94 is above the 20-day moving average (MA) of 11.53, above the 50-day MA of 10.82, and above the 200-day MA of 11.26, indicating a bullish trend. The MACD of 0.76 indicates Negative momentum. The RSI at 64.50 is Neutral, neither overbought nor oversold. The STOCH value of 77.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NPCE.

NeuroPace Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TCMD	70 Outperform	$495.40M	28.63	8.80%	―	9.28%	21.00%
NPCE	61 Neutral	$431.00M	―	-169.27%	―	24.08%	24.08%
DCTH	58 Neutral	$315.35M	1,001.16	1.94%	―	251.54%	―
RXST	55 Neutral	$400.06M	―	-12.92%	―	10.75%	-7.15%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
CBLL	51 Neutral	$478.53M	―	-59.78%	―	―	―
SENS	45 Neutral	$241.06M	―	-129.29%	―	31.94%	36.59%

NeuroPace Corporate Events

NeuroPace, Inc. Reports Record Revenue and Growth

In a recent earnings call, NeuroPace, Inc. showcased a robust financial performance with strong revenue growth and positive adjusted EBITDA. Despite some challenges, such as the winding down of the DIXI product line and extended timelines for pediatric indication, the overall sentiment was optimistic, driven by strategic progress and positive developments.

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, notably through its RNS System, a brain-responsive platform aimed at reducing seizures in patients with drug-resistant epilepsy.

Neuropace, Inc. Advances in Treating Lennox-Gastaut Syndrome: A Study Update

Study Overview: The RNS System LGS Feasibility Study, officially titled RNS System Feasibility Study of Thalamocortical Brain-Responsive Neurostimulation for the Treatment of Lennox-Gastaut Syndrome, aims to gather preliminary safety and effectiveness data for brain-responsive neurostimulation. This study targets individuals aged 12 or older with Lennox-Gastaut Syndrome (LGS) who do not respond to antiseizure medications. The goal is to assess the feasibility of a larger pivotal study to expand the RNS System’s use for treating medically intractable LGS.

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.