Avita Medical (RCEL) AI Stock Analysis

• Market Cap: $132.02M
• Dividend Yield: N/A
• Average Volume (3M): 210.40K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.54
• Revenue Growth: 20.59%
• EPS Growth: 18.61%
• Country: US
• Employees: 260
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Devices
• EPS (TTM): -0.38
• Shares Outstanding: 30,631,794
• 10 Day Avg. Volume: 180,009
• 30 Day Avg. Volume: 210,401
• PEG Ratio: 0.07
• Price to Book (P/B): -5.77
• Price to Sales (P/S): 1.34
• P/FCF Ratio: -3.08
• Enterprise Value/Market Cap: 0.85
• Enterprise Value/Revenue: 1.57
• Enterprise Value/Gross Profit: 1.91
• Enterprise Value/Ebitda: -2.72
• 1Y Price Target: $4.50
• Price Target Upside: -6.05% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): -0.96
• Revenue Forecast (FY): $82.55M

• Rating: 50 Neutral
• Price Target: $5.00 ▲(4.38% Upside)
• Action: Reiterated Date: 02/13/26
• Date: Action: Reiterated 02/13/26

The score is held back primarily by weak financial performance (continued losses, cash burn, and negative equity). The earnings call adds support via improving cash use, cost discipline, and positive FY2026 growth guidance, while technicals and valuation remain mixed with no clear bullish trend or profitability-based valuation anchor.

Positive Factors

High gross margins

Sustained >80% gross margins signal strong unit economics from RECELL and consumables. High incremental gross profit per procedure supports scalable profitability as utilization normalizes, allowing revenue growth to flow through to gross profit before fixed-cost absorption at scale.

Revenue growth & multi-product platform

Consecutive top-line growth and explicit FY2026 guidance reflect demand normalization and execution. Combined with product expansion (CoHiliX, PermeDerm, ReCell Go CE Mark) and focus on ~200 core burn/trauma centers, the company can diversify revenue and increase repeat consumable usage over the medium term.

Refinancing improved liquidity and covenants

The interest-only, five-year facility with lower cash and revenue covenants materially reduces near-term covenant risk and extends runway. Coupled with sequentially improving cash use, the financing provides structural liquidity flexibility to fund commercialization and clinical milestones without immediate amortization pressure.

Negative Factors

Negative shareholders' equity

Negative equity reflects cumulative losses and meaningfully weakens capitalization. It constrains borrowing capacity, raises the likelihood of equity dilution or restructuring to raise capital, and limits strategic flexibility if revenue or cash flow disappoint relative to covenant thresholds.

Persistent cash burn

Consistent negative operating and free cash flow signals structural reliance on external financing. Although cash burn has moderated sequentially, the business needs sustained positive operating cash generation to fund growth and avoid repeated dilution or costly financing, increasing long-term execution risk.

OpEx still exceeds revenue

Quarterly operating expenses surpassing revenue indicate a structural scale gap. Until revenue grows materially or OpEx is further reduced, the company will likely remain loss-making, delaying sustainable profitability and increasing sensitivity to reimbursement, utilization, or financing shocks.

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

High gross margins (~80%+) are a clear strength, but the financial profile remains high-risk due to persistent large net losses, ongoing negative operating/free cash flow, and a major balance-sheet concern from the most recent period showing negative shareholders’ equity.

Income Statement

Revenue scaled strongly from 2021–2024, but the most recent annual period shows a sharp reversal in growth. Gross margins remain very high (consistently ~80%+), suggesting strong unit economics, but profitability is still weak with large net losses across all periods and negative net margins. Overall: solid gross profitability profile, but earnings power has not yet translated into bottom-line profitability and recent growth volatility is a key concern.

Balance Sheet

Leverage and capitalization have deteriorated materially: debt was very high relative to equity in 2024, and the most recent annual period shows negative shareholders’ equity (a meaningful balance-sheet red flag). While total debt appears much lower in the latest period, negative equity limits financial flexibility and increases financing risk. Overall: balance sheet quality has weakened, with equity erosion being the main pressure point.

Cash Flow

Cash generation remains a challenge with negative operating and free cash flow in every period shown. There is improvement versus 2024 in absolute cash burn (operating cash outflow narrowed), but the business is still consuming cash and free cash flow growth is highly negative in the latest year. Overall: cash burn is moderating at times, but the company has not demonstrated sustainable self-funding operations.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Jun 2021
Income Statement
Total Revenue	71.61M	64.25M	50.14M	34.42M	33.02M
Gross Profit	58.82M	55.16M	42.36M	28.38M	26.92M
EBITDA	-39.59M	-55.30M	-33.54M	-26.05M	-24.40M
Net Income	-48.59M	-61.84M	-35.38M	-26.66M	-25.14M
Balance Sheet
Total Assets	56.39M	79.71M	111.64M	98.26M	116.02M
Cash, Cash Equivalents and Short-Term Investments	18.18M	35.88M	89.06M	79.34M	85.16M
Total Debt	2.13M	45.98M	42.41M	918.00K	1.64M
Total Liabilities	73.04M	75.21M	62.58M	13.52M	11.39M
Stockholders Equity	-16.65M	4.50M	49.06M	84.74M	104.62M
Cash Flow
Free Cash Flow	-31.20M	-58.27M	-39.46M	-19.61M	-18.52M
Operating Cash Flow	-31.20M	-48.94M	-38.01M	-19.09M	-18.04M
Investing Cash Flow	12.45M	37.36M	1.61M	-19.33M	-50.21M
Financing Cash Flow	14.94M	3.51M	40.37M	900.00K	64.06M

Avita Medical Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4.79
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCEL, the sentiment is Positive. The current price of 4.79 is above the 20-day moving average (MA) of 4.24, above the 50-day MA of 3.79, and below the 200-day MA of 4.80, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 68.58 is Neutral, neither overbought nor oversold. The STOCH value of 93.26 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RCEL.

Avita Medical Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RPID	57 Neutral	$184.83M	―	-68.83%	―	16.63%	10.43%
OWLT	56 Neutral	$297.87M	-4.20	―	―	26.83%	-52.47%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
RCEL	50 Neutral	$132.02M	-2.50	―	―	20.59%	18.61%
ANIK	50 Neutral	$151.71M	-4.70	-8.73%	―	-31.29%	65.68%
LUCD	49 Neutral	$175.67M	-1.54	-331.24%	―	5.01%	20.76%
LNSR	45 Neutral	$135.21M	-2.59	-422.35%	―	21.02%	-200.88%

Avita Medical Corporate Events

Avita Medical Secures New Credit Facility and Warrants

On January 13, 2026, AVITA Medical reported unaudited preliminary results showing full-year 2025 revenue of approximately $71.6 million, up about 11% from 2024 and within its revised guidance, despite a slight year-on-year decline in fourth-quarter revenue to roughly $17.6 million. The company refinanced its existing debt on the same date by closing a new five-year senior secured credit facility of up to $60 million with Perceptive Advisors, immediately drawing $50 million to repay prior borrowings and bolster liquidity, with an additional $10 million available through the first quarter of 2027. The new facility, secured against substantially all company assets and guaranteed by a U.S. subsidiary, introduces revenue-based financial covenants and minimum cash requirements that tighten operational discipline while resetting covenant levels to align with current performance. In conjunction with the financing, AVITA agreed to issue a 10-year warrant to Perceptive Advisors for up to 500,000 shares of common stock, potentially rising to 650,000 shares if the additional $10 million is drawn, subject to shareholder approval under Australian listing rules. Management highlighted that the strengthened balance sheet, together with advancing clinical programs—including full enrollment of the Cohealyx-I study and over 75% enrollment in PermeaDerm-I as of December 2025—positions the company to shift from stabilization to execution-led growth in 2026, when it expects to deliver revenue of approximately $80 million to $85 million, implying a 12% to 19% increase over 2025.

The most recent analyst rating on (RCEL) stock is a Hold with a $3.50 price target. To see the full list of analyst forecasts on Avita Medical stock, see the RCEL Stock Forecast page.

Avita Medical Adds Veteran Director Amid Leadership Transition

On January 5, 2026, AVITA Medical announced that veteran healthcare executive Joe Woody had been appointed as a new non-executive director effective January 1, 2026, while longtime chairman Lou Panaccio retired after more than a decade of service, including his tenure as chairman from July 2014 to August 2025. Woody, a former CEO of Avanos Medical and Acelity Holdings with extensive experience across major med-tech companies and industry association AdvaMed, will serve on all board committees and receive a mix of annual cash compensation and equity grants for his board role, a move that AVITA’s leadership framed as strengthening the board’s strategic and commercial expertise at a pivotal stage in the company’s growth and supporting its focus on long-term value creation for stakeholders as it scales its acute wound care business globally.

The most recent analyst rating on (RCEL) stock is a Sell with a $3.00 price target. To see the full list of analyst forecasts on Avita Medical stock, see the RCEL Stock Forecast page.