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TELA Bio (TELA)
NASDAQ:TELA
US Market

TELA Bio (TELA) AI Stock Analysis

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TELA Bio

(NASDAQ:TELA)

Rating:60Neutral
Price Target:
$2.00
▲(17.65%Upside)
TELA Bio's score reflects strong revenue growth and positive technical indicators, tempered by financial instability and valuation challenges. Strategic leadership changes and effective sales strategies provide optimism for future growth.
Positive Factors
Growth Potential
Reaching the milestone of $100M in revenues brings the company closer to profitability and increases the tangibility of TELA as a take-out candidate.
Product Excellence
TELA's products are considered best-in-class, supported by strong clinical data and trends in robotic adoption.
Negative Factors
Financial Performance
TELA reported Q4 results, which were well below estimates, with a significant sales force turnover impacting the company's performance.
Sales Challenges
The departure of 11 of 69 high-performing territory managers led to a significant drop in sales.

TELA Bio (TELA) vs. SPDR S&P 500 ETF (SPY)

TELA Bio Business Overview & Revenue Model

Company DescriptionTELA Bio, Inc., a commercial-stage medical technology company, focuses on providing soft-tissue reconstruction solutions that optimize clinical outcomes by prioritizing the preservation and restoration of the patient's anatomy. It provides a portfolio of OviTex Reinforced Tissue Matrix (OviTex) products for hernia repair and abdominal wall reconstruction; and OviTex PRS Reinforced Tissue Matrix products to address the unmet needs in plastic and reconstructive surgery, as well as OviTex for Laparoscopic and Robotic Procedures, a sterile reinforced tissue matrix derived from ovine rumen with polypropylene fiber intended to be used in laparoscopic and robotic-assisted hernia surgical repairs. The company markets its products through a single direct sales force, principally in the United States. TELA Bio, Inc. was incorporated in 2012 and is headquartered in Malvern, Pennsylvania.
How the Company Makes MoneyTELA Bio generates revenue primarily through the sale of its OviTex products to hospitals, surgical centers, and healthcare providers. The company operates within the medical device industry, where it benefits from the growing demand for advanced tissue reinforcement and reconstruction solutions. Key revenue streams include direct sales to healthcare facilities and strategic partnerships with medical distributors that expand the reach of their products. TELA Bio's earnings are also influenced by factors such as the adoption rate of innovative surgical technologies, ongoing research and development efforts, and the company's ability to navigate regulatory requirements in various markets.

TELA Bio Earnings Call Summary

Earnings Call Date:May 08, 2025
(Q1-2025)
|
% Change Since: 71.72%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
TELA Bio's earnings call highlighted strong revenue growth and product demand, particularly in the European market, despite facing some challenges such as tariff impacts and increased net loss. The company's strategic organizational changes and innovative product launches position it well for future growth.
Q1-2025 Updates
Positive Updates
Revenue Growth
TELA Bio reported $18.5 million in revenue for Q1 2025, marking a 12% year-over-year increase and a 5% sequential growth from Q4 2024.
Strong Product Demand
OviTex and OviTex PRS products saw significant demand, with each growing approximately 152% year-over-year.
European Market Expansion
TELA Bio's European business grew by 17% compared to Q1 2024, indicating a strong international presence.
Sales Force Effectiveness
The new territory manager and account specialist structure has been effective, with 25 new sales team members trained in 2025.
Market Leadership in Hernia Repair
TELA Bio is well positioned to capitalize on the industry's shift away from synthetic mesh, with OviTex products demonstrating strong market traction.
Innovative Product Launches
Launched larger sizes of OviTex PRS to address more complex procedures, enhancing operating room efficiency and reducing costs.
Wide Engagement with Surgeons
Presented products to over 5,000 surgeons globally through various educational and symposium events.
Negative Updates
Gross Margin Impact from Tariffs
A 10% tariff on products manufactured in New Zealand negatively impacted gross margins by 50 to 100 basis points.
Increased Net Loss
Net loss for Q1 2025 was $11.3 million compared to $5.7 million in the prior year period, partly due to the absence of a one-time gain from a product line sale in 2024.
PRS Unit Sales Decline
PRS unit sales declined by 3% in Q1 2025 due to a strong performance in Q1 2024, although stronger ASP offset this decline.
Company Guidance
During the TELA Bio First Quarter 2025 Earnings Conference Call, the company reported $18.5 million in revenue, marking a 12% year-over-year increase and 5% sequential growth compared to the fourth quarter of 2024. The revenue growth was driven by the strong performance of OviTex and OviTex PRS reinforced tissue matrix products, each showing approximately 152% revenue growth. TELA Bio also experienced a 17% growth in its European business over the same period last year. The company reaffirmed its 2025 revenue guidance of $85 to $88 million, projecting a 23% to 27% growth over the full year 2024. The call highlighted the effectiveness of the new territory manager (TM) and account specialist (AS) structure, with 70 TMs and 22 ASs in place, and the successful training of 25 new sales team members. The gross margin for the first quarter was 67.6%, slightly down from 68.3% the previous year, impacted by excess and obsolete inventory adjustments. Operating and net losses were $10.5 million and $11.3 million, respectively, with expectations for both to decrease over the course of the year. TELA Bio also addressed the impact of a 10% tariff on products shipped from New Zealand, expected to reduce the gross margin by 50 to 100 basis points.

TELA Bio Financial Statement Overview

Summary
TELA Bio is seeing revenue growth, but ongoing operational losses and high financial leverage present significant risks. The company needs to improve its profitability and manage costs effectively to enhance financial stability.
Income Statement
60
Neutral
TELA Bio has shown consistent revenue growth over recent years, with a TTM revenue growth rate of 2.77% and a significant annual increase from 2022 to 2023 at 40%. However, the company remains unprofitable, with negative EBIT and EBITDA margins indicating ongoing operational losses. The gross profit margin is relatively stable at around 67%, which is a positive aspect, but the persistent net losses highlight the challenge in achieving profitability.
Balance Sheet
50
Neutral
The balance sheet reflects a high debt-to-equity ratio, indicating high financial leverage which poses a risk. The equity ratio is low at 23.46%, suggesting limited shareholder equity relative to total assets. Although cash reserves are substantial, the continuous losses are eroding equity. The company's return on equity is negative due to its negative net income.
Cash Flow
55
Neutral
Cash flow analysis shows negative operating cash flow, which is concerning, yet offset by positive financing cash flows, mainly through debt. The free cash flow remains negative, despite a slight improvement in TTM compared to the previous year. The operating cash flow to net income ratio is below 1, indicating cash flow issues tied to profitability concerns.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
71.22M69.30M58.45M41.42M29.46M18.21M
Gross Profit
47.66M46.49M40.11M27.04M18.81M11.23M
EBIT
-39.76M-34.12M-44.08M-39.01M-29.45M-25.27M
EBITDA
-37.31M-31.68M-40.63M-39.06M-29.14M-24.70M
Net Income Common Stockholders
-43.44M-37.84M-46.66M-44.34M-36.11M-31.88M
Balance SheetCash, Cash Equivalents and Short-Term Investments
42.83M52.67M46.73M42.02M43.93M74.39M
Total Assets
77.25M86.57M78.05M67.86M62.54M86.46M
Total Debt
41.81M41.67M41.08M39.92M31.49M30.83M
Net Debt
-1.03M-11.00M-5.65M-2.10M-12.44M-43.57M
Total Liabilities
59.13M58.11M59.17M53.55M42.45M37.43M
Stockholders Equity
18.12M28.46M18.88M14.30M20.10M49.03M
Cash FlowFree Cash Flow
-37.65M-42.58M-41.47M-42.62M-31.06M-24.62M
Operating Cash Flow
-36.94M-41.59M-40.86M-40.75M-30.43M-24.46M
Investing Cash Flow
-107.00K4.45M-599.00K-1.87M-627.00K9.12M
Financing Cash Flow
42.88M43.06M46.27M40.85M585.00K44.41M

TELA Bio Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price1.70
Price Trends
50DMA
1.22
Positive
100DMA
1.78
Negative
200DMA
2.27
Negative
Market Momentum
MACD
0.18
Negative
RSI
59.15
Neutral
STOCH
67.56
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TELA, the sentiment is Neutral. The current price of 1.7 is above the 20-day moving average (MA) of 1.57, above the 50-day MA of 1.22, and below the 200-day MA of 2.27, indicating a neutral trend. The MACD of 0.18 indicates Negative momentum. The RSI at 59.15 is Neutral, neither overbought nor oversold. The STOCH value of 67.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TELA.

TELA Bio Risk Analysis

TELA Bio disclosed 72 risk factors in its most recent earnings report. TELA Bio reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

TELA Bio Peers Comparison

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
60
Neutral
$103.29M-16.53%-4.15%3.49%
60
Neutral
$73.18M-267.29%12.78%15.53%
58
Neutral
$76.98M-52.88%29.64%
58
Neutral
$39.85M-276.15%41.54%42.59%
56
Neutral
$64.82M-130.26%-6.27%16.76%
54
Neutral
$5.41B3.27-45.10%3.29%16.81%0.02%
$43.24M-257.72%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TELA
TELA Bio
1.70
-3.84
-69.31%
APYX
Apyx Medical
1.75
0.28
19.05%
ICAD
iCAD
3.68
2.19
146.98%
NVNO
enVVeno Medical
4.34
-0.55
-11.25%
ECOR
Electrocore
5.09
-1.18
-18.82%
MODD
Modular Medical
0.77
-0.92
-54.44%

TELA Bio Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
TELA Bio Announces Leadership Change with New President
Positive
Jun 2, 2025

On May 30, 2025, TELA Bio announced the resignation of Jeffrey Blizard from its Board of Directors, effective June 2, 2025, as he transitions to the role of President. This strategic leadership change is expected to enhance TELA Bio’s growth trajectory, with Blizard bringing extensive industry experience from his previous role at Abiomed, a Johnson & Johnson company. The appointment is seen as a significant step in strengthening the company’s executive team to drive commercial performance and value delivery to stakeholders.

The most recent analyst rating on (TELA) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on TELA Bio stock, see the TELA Stock Forecast page.

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
TELA Bio Approves Key Proposals at Annual Meeting
Neutral
May 30, 2025

On May 28, 2025, TELA Bio, Inc. held its Annual Meeting of Stockholders where several key proposals were approved. The stockholders voted to amend the 2019 Equity Incentive Plan by increasing the authorized shares by 3,500,000 and removing the ‘evergreen’ provision. Additionally, the election of Class III directors, the ratification of KPMG LLP as the independent public accountant, and the approval of executive compensation were confirmed. The amendment to the company’s Certificate of Incorporation to limit officer liability was also approved, reflecting strategic governance adjustments.

The most recent analyst rating on (TELA) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on TELA Bio stock, see the TELA Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
TELA Bio Reports Q1 2025 Revenue Growth Amid Losses
Neutral
May 8, 2025

On May 8, 2025, TELA Bio reported its financial results for the first quarter of 2025, showing a revenue increase to $18.5 million, up 12% from the previous year. The growth was driven by increased demand for their OviTex products and the full U.S. commercial launch of larger-sized OviTex PRS. Despite the revenue growth, the company reported a net loss of $11.3 million, attributed to decreased gross margins and increased operating expenses. TELA Bio reiterated its full-year revenue guidance, expecting a 23% to 27% growth over 2024, and highlighted the optimization of its sales organization as a key factor in achieving new account wins and market penetration.

Business Operations and StrategyFinancial Disclosures
TELA Bio Projects Strong Revenue Growth for 2025
Positive
Mar 20, 2025

On March 20, 2025, TELA Bio reported its financial results for the fourth quarter and full year of 2024, showing a 19% revenue growth for the year, driven by increased demand for its OviTex and OviTex PRS products. Despite some disruptions affecting the fourth quarter, the company remains optimistic about capturing additional market share and restoring growth. TELA Bio also provided a revenue guidance for 2025, projecting growth of 23% to 27% over 2024, while maintaining operating expenses at the same level as the previous year.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.