Avita Medical (RCEL) AI Stock Analysis

• Market Cap: $101.54M
• Dividend Yield: N/A
• Average Volume (3M): 192.96K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.71
• Revenue Growth: 20.59%
• EPS Growth: 18.61%
• Country: US
• Employees: 260
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.46
• Shares Outstanding: 30,493,110
• 10 Day Avg. Volume: 183,359
• 30 Day Avg. Volume: 192,964
• PEG Ratio: -0.08
• Price to Book (P/B): 73.64
• Price to Sales (P/S): 5.16
• P/FCF Ratio: -5.69
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $6.50
• Price Target Upside: 57.77% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): -1.64
• Revenue Forecast (FY): $72.25M

• Rating: 39 Underperform
• Price Target: $3.00 ▼(-27.18% Downside)

The overall stock score of 39 reflects significant financial challenges and a bearish technical outlook. Financial performance is the most critical factor, with negative margins, high leverage, and cash flow issues. The technical analysis further supports a negative sentiment, with the stock trading below key moving averages and oversold indicators. Valuation metrics are also unfavorable, with a negative P/E ratio. While the earnings call provided some positive developments, they are overshadowed by ongoing financial difficulties.

Positive Factors

Reimbursement Progress

The confirmation of reimbursement rates by all MACs is a significant structural improvement, likely to drive renewed demand and utilization normalization, supporting revenue growth.

European Expansion

The CE Mark approval for RECELL GO in Europe expands Avita's market presence and access, potentially increasing revenue streams and enhancing global competitiveness.

Cost Management

Effective cost management and restructuring have led to significant expense reductions, which can improve profitability and financial sustainability over the long term.

Negative Factors

Revenue Decline

The decline in revenue indicates challenges in maintaining sales momentum, which could impact financial stability and growth prospects if not addressed.

High Leverage

High leverage and negative equity raise concerns about financial stability and solvency, potentially limiting strategic flexibility and increasing risk.

Leadership Change

Leadership changes can create uncertainty and disrupt strategic continuity, impacting long-term planning and execution until a permanent CEO is appointed.

Avita Medical Business Overview & Revenue Model

Company Description

AVITA Medical Inc. operates as a commercial-stage regenerative tissue company in the United States, Australia, and the United Kingdom. It offers regenerative products to address unmet medical needs in burn injuries, trauma injuries, chronic wounds, and dermatological and aesthetics indications, including vitiligo. The company's patented and proprietary platform technology provides treatment solutions derived from the regenerative properties of a patient's own skin. Its lead product is RECELL System, a device that enables healthcare professionals to produce a suspension of Spray-On Skin cells using a small sample of the patient's own skin for use in the treatment of acute thermal burns in patients eighteen years and older. The company has a research collaboration with the University of Colorado School of Medicine to establish pre-clinical proof-of-concept for a spray-on treatment of genetically corrected cells; and a research collaboration with Houston Methodist Research Institute to explore molecular reversal of cellular aging through a novel cell suspension delivery system. The company was formerly known as AVITA Therapeutics, Inc. and changed its name to AVITA Medical Inc. in December 2020. AVITA Medical Inc. was incorporated in 2000 and is based in Valencia, California.

How the Company Makes Money

Avita Medical generates revenue primarily through the sale of its RECELL System and related consumables. The company has established a business model that includes direct sales to healthcare providers, hospitals, and clinics, as well as partnerships with distributors to expand its market reach. Key revenue streams come from the initial sale of the RECELL devices and ongoing revenue from the consumable kits required for each procedure. Additionally, Avita Medical engages in strategic partnerships and collaborations with other healthcare organizations and institutions, which can provide funding, enhance research capabilities, and broaden market access. The company may also benefit from reimbursement arrangements with insurers, which can facilitate patient access to its products and drive sales growth.

Avita Medical Financial Statement Overview

Summary

Avita Medical is facing significant financial challenges across all verticals. The company is struggling with profitability and revenue growth, as evidenced by negative margins and declining sales. The balance sheet shows high leverage and negative equity, raising concerns about financial stability. Cash flow issues further compound the situation, with negative operating and free cash flows. The company needs to address these issues to improve its financial health and sustainability.

Income Statement

Avita Medical's income statement reflects significant challenges with profitability. The TTM data shows a negative net profit margin of -68.87%, indicating substantial losses relative to revenue. Revenue growth has also declined by 3.32% in the TTM, suggesting a contraction in sales. The gross profit margin remains high at 84.28%, which is a positive indicator of operational efficiency. However, the negative EBIT and EBITDA margins highlight ongoing operational losses.

Balance Sheet

The balance sheet reveals a concerning financial structure, with a negative stockholders' equity of -$6.67 million in the TTM, leading to an unsustainable debt-to-equity ratio of -3.46. This indicates high leverage and potential solvency issues. The return on equity is extremely high at 279.91%, but this is due to the negative equity, which distorts the metric. The equity ratio is also negative, reflecting financial instability.

Cash Flow

Cash flow analysis shows negative operating cash flow of -$33.84 million and free cash flow of -$37.19 million in the TTM, indicating cash burn. The free cash flow to net income ratio is positive at 1.17, suggesting that free cash flow is slightly better than net income, but both are negative. The operating cash flow to net income ratio is negative, highlighting cash flow challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	72.40M	64.25M	50.14M	34.42M	33.02M	29.23M
Gross Profit	60.63M	55.16M	42.36M	28.38M	26.92M	23.28M
EBITDA	-41.40M	-55.30M	-33.54M	-26.05M	-24.40M	-25.81M
Net Income	-48.55M	-61.84M	-35.38M	-26.66M	-25.14M	-26.58M
Balance Sheet
Total Assets	63.73M	79.71M	111.64M	98.26M	116.02M	125.50M
Cash, Cash Equivalents and Short-Term Investments	23.31M	35.88M	89.06M	79.34M	85.16M	110.75M
Total Debt	44.77M	45.98M	42.41M	918.00K	1.64M	878.00K
Total Liabilities	70.39M	75.21M	62.58M	13.52M	11.39M	9.85M
Stockholders Equity	-6.67M	4.50M	49.06M	84.74M	104.62M	115.66M
Cash Flow
Free Cash Flow	-37.19M	-58.27M	-39.46M	-19.61M	-18.52M	-27.07M
Operating Cash Flow	-33.84M	-48.94M	-38.01M	-19.09M	-18.04M	-25.90M
Investing Cash Flow	14.91M	37.36M	1.61M	-19.33M	-50.21M	-1.17M
Financing Cash Flow	15.71M	3.51M	40.37M	900.00K	64.06M	64.05M

Avita Medical Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.12
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCEL, the sentiment is Negative. The current price of 4.12 is above the 20-day moving average (MA) of 3.60, above the 50-day MA of 3.94, and below the 200-day MA of 5.88, indicating a bearish trend. The MACD of -0.17 indicates Positive momentum. The RSI at 31.93 is Neutral, neither overbought nor oversold. The STOCH value of 14.83 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RCEL.

Avita Medical Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OWLT	56 Neutral	$350.83M	-4.69	―	―	26.83%	-52.47%
RPID	56 Neutral	$156.02M	-3.35	-68.83%	―	16.63%	10.43%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
ANIK	49 Neutral	$137.15M	-4.14	-8.73%	―	-31.29%	65.68%
LUCD	47 Neutral	$146.83M	-1.24	-331.24%	―	5.01%	20.76%
RCEL	39 Underperform	$101.54M	―	-1746.27%	―	20.59%	18.61%
LNSR	38 Underperform	$144.05M	-2.72	-422.35%	―	21.02%	-200.88%

Avita Medical Corporate Events

Avita Medical Amends Credit Agreement with OrbiMed

On November 5, 2025, AVITA Medical agreed to a sixth amendment to its credit agreement with OrbiMed Advisors, adjusting the revenue covenant to $70 million for the quarter ending December 31, 2025. The amendment also waived a ‘going concern’ requirement for the third quarter, with AVITA adding $500,000 to the principal balance as consideration. The company’s Q3 2025 financial results showed a 13% decrease in commercial revenue compared to the previous year, attributed to reimbursement challenges. However, operating expenses decreased by 24%, and net loss improved. AVITA received CE Mark approval for RECELL GO® in Europe, expanding its international presence. The company is focusing on key U.S. centers and expects full-year revenue between $70 and $74 million, down from prior guidance.

Avita Medical Appoints Cary Vance as Interim CEO

On October 16, 2025, AVITA Medical announced the departure of CEO James Corbett and the appointment of Cary Vance as Interim CEO. Vance, who has extensive experience in the healthcare industry, will also continue as Chairman of the Board. The company expects third-quarter revenue to be approximately $17 million and is in discussions with OrbiMed to redefine future financial covenants. The Board plans to engage an executive search firm to find a permanent CEO, considering both internal and external candidates, including Vance.