PRCT Stock Tumbles Pre-Market: BofA Questions Earnings Visibility, Cuts Target To $20

Bank of America reduced its rating on PROCEPT BioRobotics to ‘Underperform’ from ‘Neutral’.

• PROCEPT BioRobotics’ Q4 revenue of $76.4 million and loss per share of $0.53 both missed street estimates. 
• According to Bank of America, in Q4, PROCEPT BioRobotics delivered results that fell short of analyst forecasts by 18.5%.
• The firm indicated that the latest quarterly update failed to ease concerns about execution and financial momentum.

Bank of America has downgraded PROCEPT BioRobotics Corp. (PRCT) shares, citing mounting concerns about earnings visibility and profitability, reflecting skepticism about the company’s near-term performance as it navigates widening losses.

In the fourth quarter (Q4), the company reported a revenue of $76.4 million, a 12% year-over-year (YoY) increase, and a loss per share (EPS) of $0.53. Both the financial metrics were below the analysts’ consensus estimates of $93.70 million and a loss of $0.31, respectively, according to Fiscal AI data. 

PROCEPT BioRobotics’ stock traded over 28% lower in Thursday’s premarket. 

BofA Flags Profitability Concerns

Bank of America reduced its rating on PROCEPT BioRobotics to ‘Underperform’ from ‘Neutral’ and slashed its price target to $20 from $38, according to TheFly. The firm flagged fresh doubts following the company’s Q4 earnings discussion, noting uncertainty about whether management can meet Wall Street’s projections. 

Bank of America indicated that the latest quarterly update failed to ease concerns about execution and financial momentum.

According to Bank of America, in Q4, PROCEPT BioRobotics delivered results that fell short of analyst forecasts by 18.5%. The shortfall coincides with a shift in the company’s longstanding approach to offering volume-based discounts to customers. At the same time, management has undertaken a reorganization of its sales team, adding another layer of transition risk.

The firm emphasized that the company remains unprofitable, with operating losses deepening after the latest earnings. That trend, Bank of America argued, constrains the stock’s valuation and limits potential upside in the near term. 

Retail Traders Remain Bullish Despite Selloff

However, on Stocktwits, retail sentiment around the stock changed to ‘extremely bullish’ from ‘bullish’ territory the previous day. Message volume flipped to ‘extremely high’ from ‘normal’ levels in 24 hours. 

PRCT stock has declined by over 59% in the last 12 months. 

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