Neuronetics (STIM) AI Stock Analysis

• Market Cap: $244.85M
• Dividend Yield: N/A
• Average Volume (3M): 735.77K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.49
• Revenue Growth: 22.16%
• EPS Growth: -37.60%
• Country: US
• Employees: 716
• Sector: Healthcare
• Sector Strength: 42
• Industry: Medical - Diagnostics & Research
• EPS (TTM): -0.21
• Shares Outstanding: 65,820,340
• 10 Day Avg. Volume: 434,751
• 30 Day Avg. Volume: 735,769
• PEG Ratio: -1.09
• Price to Book (P/B): 6.45
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -6.57
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 0.99
• Enterprise Value/Gross Profit: 5.41
• Enterprise Value/Ebitda: -2.45
• 1Y Price Target: $8.00
• Price Target Upside: 115.05% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 49 Neutral
• Price Target: $4.00 ▲(7.53%Upside)

The most significant factor is the ongoing financial challenges, including consistent losses and cash flow issues, which weigh heavily on the score. While the earnings call provided some positive long-term guidance, short-term financial health remains a concern. Technical indicators suggest neutral sentiment, and valuation metrics highlight profitability challenges.

Positive Factors

Business Model Shift

The company is shifting away from capital sales to improve gross margins and focus on driving utilization for sustained operating profitability and positive free cash flow.

Merger Benefits

The merger with Greenbrook TMS is expected to enhance growth, scale, and patient reach as a vertically integrated mental healthcare provider.

Revenue Growth

STIM reported a solid Q1 operationally, with revenue of $32.0M, well above consensus estimates.

Negative Factors

Cash Burn

The stock traded off on the higher-than-expected cash burn for Q1.

Core Segment Weakness

Weakness in the core Neuronetics segment was driven primarily by treatment session revenues, partly offset by system sales.

Macroeconomic Risks

There are underlying risks with acquisitions, particularly given the two different business models at Neuronetics and Greenbrook on top of a continued uncertain macroeconomic environment.

Neuronetics Business Overview & Revenue Model

Company Description

Neuronetics, Inc., a commercial stage medical technology company, designs, develops, and markets products for patients with neurohealth disorders in the United States and internationally. The company offers NeuroStar Advanced Therapy System, a non-invasive and non-systemic office-based treatment to treat adult patients with major depressive disorder. Its NeuroStar Advanced Therapy System uses transcranial magnetic stimulation to create a pulsed, MRI-strength magnetic field that induces electrical currents designed to stimulate specific areas of the brain associated with mood. The company sells its products through its sales and customer support team to psychiatrists. Neuronetics, Inc. was incorporated in 2001 and is headquartered in Malvern, Pennsylvania.

How the Company Makes Money

Neuronetics generates revenue primarily through the sale and leasing of its NeuroStar Advanced Therapy Systems to healthcare providers, including hospitals, clinics, and private practices. The company also earns income from the sale of related consumables and accessories required for the operation of its TMS devices. Additionally, Neuronetics offers service and maintenance contracts for its systems, providing an ongoing revenue stream. Key partnerships with healthcare providers and institutions help expand the adoption of its technology, contributing to its earnings. Neuronetics' financial performance is influenced by factors such as the growing demand for mental health treatments, regulatory approvals, and the expansion of its customer base.

Neuronetics Financial Statement Overview

Summary

Neuronetics shows modest revenue growth, but consistent losses and cash flow difficulties are significant concerns. High leverage and reliance on external financing pose risks, requiring operational improvements for better financial health.

Income Statement

Neuronetics shows a modest revenue growth over the years, with a 4.96% increase from 2023 to 2024. However, the company has consistently reported negative EBIT and net income margins, indicating ongoing profitability challenges. The gross profit margin remains relatively healthy, but the persistent negative EBITDA margin points to operational inefficiencies.

Balance Sheet

The balance sheet reflects significant leverage with a high debt-to-equity ratio, although it has improved slightly from the previous year. The equity ratio is relatively low, suggesting limited financial flexibility. The company has maintained a positive cash position, yet declining stockholders' equity is a concern.

Cash Flow

Neuronetics has experienced negative free cash flow growth, with cash flows consistently in the red. The operating cash flow to net income ratio is negative, highlighting cash generation issues. The company relies heavily on financing activities to manage cash needs, which may not be sustainable long-term.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
89.45M	74.89M	71.35M	65.21M	55.31M	49.24M
	Gross Profit
56.81M	54.16M	51.70M	49.72M	43.66M	37.69M
	EBIT
-38.72M	-34.56M	-30.55M	-35.11M	-27.56M	-22.31M
	EBITDA
-39.54M	-34.56M	-22.76M	-31.26M	-26.55M	-21.07M
	Net Income Common Stockholders
-48.01M	-43.71M	-30.19M	-39.21M	-35.60M	-32.28M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
60.58M	18.66M	60.58M	71.88M	96.34M	50.84M
	Total Assets
115.83M	140.90M	115.83M	116.88M	141.22M	78.66M
	Total Debt
62.47M	82.63M	62.47M	39.74M	39.54M	38.34M
	Net Debt
2.80M	64.17M	2.80M	-30.59M	-54.60M	-10.62M
	Total Liabilities
81.64M	109.10M	81.64M	59.82M	56.05M	53.16M
	Stockholders Equity
34.19M	27.71M	34.19M	57.06M	85.17M	25.49M
Cash Flow		Free Cash Flow
-37.28M	-32.46M	-34.41M	-34.01M	-30.34M	-29.12M
	Operating Cash Flow
-35.98M	-31.00M	-32.04M	-30.74M	-27.98M	-28.39M
	Investing Cash Flow
-2.70M	-2.41M	-1.32M	6.73M	-9.84M	-730.00K
	Financing Cash Flow
12.17M	-6.81M	22.70M	207.00K	83.01M	2.37M

Neuronetics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.72
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STIM, the sentiment is Negative. The current price of 3.72 is below the 20-day moving average (MA) of 4.02, below the 50-day MA of 4.04, and above the 200-day MA of 2.52, indicating a neutral trend. The MACD of -0.13 indicates Positive momentum. The RSI at 36.33 is Neutral, neither overbought nor oversold. The STOCH value of 16.18 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STIM.

Neuronetics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSNL	57 Neutral	$460.17M	―	-51.25%	―	15.57%	31.82%
MDXH	55 Neutral	$102.46M	―	-1552.23%	―	25.46%	21.83%
Sector *	54 Neutral	$5.31B	3.28	-45.10%	2.80%	16.76%	0.02%
STIM	49 Neutral	$244.85M	―	-152.14%	―	22.16%	-37.60%
ACRS	46 Neutral	$165.67M	―	-91.03%	―	-40.09%	-18.67%
SERA	45 Neutral	$58.39M	―	-41.36%	―	-44.17%	12.77%
BDSX	42 Neutral	$44.39M	―	-1454.41%	―	35.76%	47.48%

Neuronetics Corporate Events

Neuronetics Holds Annual Meeting, Elects Directors

On May 22, 2025, Neuronetics, Inc. held its Annual Meeting of Stockholders, where 81.38% of eligible shares were represented. During the meeting, all director nominees were elected for a one-year term, KPMG LLP’s appointment as the independent auditor for 2025 was ratified, and executive compensation for 2024 was approved. However, a proposal to eliminate supermajority voting requirements in the company’s governance documents was not approved.

The most recent analyst rating on (STIM) stock is a Buy with a $5.50 price target. To see the full list of analyst forecasts on Neuronetics stock, see the STIM Stock Forecast page.

Neuronetics Announces CFO Retirement Amidst Q1 Growth

On May 6, 2025, Neuronetics announced the upcoming retirement of CFO Stephen Furlong in March 2026, with a search for his successor underway. The company reported significant financial growth in the first quarter of 2025, with an 84% revenue increase driven by the Greenbrook acquisition. Neuronetics also highlighted major insurance coverage expansions for adolescent TMS treatment and projected achieving positive cash flow in the third quarter of 2025.