B. Riley has started coverage on RadNet (RDNT, Financial), assigning it a Buy rating and setting a price target of $69. RadNet stands out as the largest operator of outpatient radiology imaging centers in the United States. The company is distinct within the publicly traded radiopharma value chain, with a U.S.-focused operation that minimizes exposure to tariffs. Known as a "one-stop shop," RadNet provides both advanced and routine imaging services.
The firm emphasizes that RadNet is well-positioned to take advantage of favorable industry trends, including the shift of imaging procedures from hospital settings to outpatient imaging centers and the development of new radio imaging agents. This aligns with the broader movement towards more efficient and accessible healthcare services.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 7 analysts, the average target price for RadNet Inc (RDNT, Financial) is $71.57 with a high estimate of $80.00 and a low estimate of $60.00. The average target implies an upside of 26.50% from the current price of $56.58. More detailed estimate data can be found on the RadNet Inc (RDNT) Forecast page.
Based on the consensus recommendation from 7 brokerage firms, RadNet Inc's (RDNT, Financial) average brokerage recommendation is currently 1.6, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for RadNet Inc (RDNT, Financial) in one year is $35.67, suggesting a downside of 36.96% from the current price of $56.58. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the RadNet Inc (RDNT) Summary page.
RDNT Key Business Developments
Release Date: May 12, 2025
- Total Revenue: $471.4 million, a 9.2% increase from the first quarter of 2024.
- Adjusted EBITDA: $46.4 million, a 20.6% decrease compared to the first quarter of 2024.
- Impact of Weather and Fires: Estimated $22 million negative impact on revenue and $15 million on adjusted EBITDA.
- Advanced Imaging Procedural Volume: 26.9% of total procedural volume, up from 25.7% in the previous year.
- PET/CT Volume Growth: Increased by 22.9% driven by prostate and brain procedures.
- Digital Health Revenue: $19.2 million, a 31.1% increase from the first quarter of 2024.
- Digital Health Adjusted EBITDA: $3.7 million, a 5.4% increase from the first quarter of 2024.
- Cash Balance: $717 million at the end of the first quarter.
- Net Debt to Adjusted EBITDA Ratio: Slightly more than 1 times.
- Days Sales Outstanding (DSO): 33.3 days, slightly lower than the previous year.
- Guidance Increase: Revenue guidance increased by $10 million and adjusted EBITDA by $3 million for 2025.
- Capital Expenditure Budget: Increased by $5 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- RadNet Inc (RDNT, Financial) reported a strong recovery in March, April, and early May after severe weather and wildfires negatively impacted January and February, leading to an upward adjustment in 2025 revenue and adjusted EBITDA guidance.
- The company saw a significant increase in advanced imaging, with procedural volume from advanced imaging rising to 26.9% in Q1 2025 from 25.7% in Q1 2024.
- PET/CT volumes increased by 22.9%, driven by growth in prostate and brain procedures, which were less affected by severe weather conditions.
- The EBCD digital DeepHealth AI-powered breast cancer screening program saw a 33% increase in adoption, contributing to early cancer detection and improved radiologist productivity.
- RadNet Inc (RDNT) maintains strong liquidity with a cash balance of $717 million and a net debt to adjusted EBITDA ratio of slightly more than one, supporting future strategic investments.
Negative Points
- Severe weather conditions and wildfires in the first quarter resulted in an estimated $22 million revenue loss and a $15 million EBITDA impact.
- Adjusted EBITDA decreased by 20.6% compared to Q1 2024, despite a 9.2% increase in revenue.
- The company faces ongoing challenges with rising labor costs and a shortage of radiology technologists, impacting operational capacity.
- The first quarter is typically the most challenging due to increased payroll taxes, employee bonuses, and lower healthcare utilization from deductible resets.
- Stock-based compensation increased significantly to $28.5 million in Q1 2025, close to last year's full-year number, impacting profitability.
