Tactile Systems is trading low. Is it worth buying?

Tactile Systems is trading low. Is it worth buying?

The Tech sector is very diversified. There are all kinds of stocks gathered under its wing. Tactile Systems Technology is one of them. This company develops at-home therapy devices, attempting to provide new treatments for lymphedema. That occurs when the lymphatic system is impaired and disrupts normal transport of fluid within the body.

The stock plummeted down by 52% year-to-date. Its shares are trading at $32.67 currently, close to its $29.47 52-week low. However, business trends are improving. So, Wall Street analysts advise grabbing this stock now.

In the second half of March, the stock’s volumes tumbled down by 50% compared to the first half of the month. Furthermore, Tactile Systems’ patient volumes were challenged in April and May.

Canaccord’ analyst Cecilia Furlong also noted that the coronavirus pandemic had hampered the company, weighing on both its volumes and sales. However, trends started to improve at the end of May.

Considering the vast majority of this stock’s clinician customers practice in outpatient or office-based settings, Canaccord is sure in Tactile Systems’ ability to demonstrate better insulation against the pandemic impacts.

Furlong stated that the stock would likely experience a greater rebound relative to overall med-tech volume trends. The company will also benefit from its expanding use of technology to support patients and remotely engage with clinicians.

 What are the stock’s other advantages?

Furlong is optimistic about new CEO Dan Reuvers, as well as the reprioritization of the firm’s investment and market development efforts. Tactile Systems plans to shift focus away from its acquired Airwear product line. It is redirecting investments toward its Flexitouch and Entre products.

Considering all these, the analyst gave the stock a Buy rating and set her price target at $62. In case of success, the investors could gain 90% in the next year.

Other analysts seem to agree with Furlong. Wall Street also gave Tactile Systems a strong-buy rating with a $62.33 average price target, which brings the upside potential to 91%.

Comments Rating 0 (0 reviews)