Rodman & Renshaw analyst Raghuram Selvaraju has assumed coverage of Semler Scientific (NASDAQ:SMLR) with a “buy” rating and $8 price target. The stock was quoted at $2.05 Friday afternoon.
Semler’s 2015 revenue of $7-million represented growth of 93% over the 2014 revenue of $3.6-million. “In our view, the solid revenue growth demonstrates the continual market penetration of the company’s FloChec system, which is used to measure arterial blood flow in the extremities for risk assessment of peripheral arterial disease,” Mr. Selvaraju writes.
Specifically, QuantaFlo, the second-generation FloChec product that Semler launched in the third quarter last year, helped attract more customers through its enhanced performance features, capabilities and expanded marketing labeling, he added.
In addition, QuantaFlo has a 10% price premium over the roughly $6,000 annual lease price of FloChec. Mr. Selvaraju said insurance payers and physicians are incentivized to provide this test to their patients as they get paid roughly $3,000 more per patient diagnosed with vascular diseases from the government.
He expects solid revenue growth going forward, and his current revenue projection for 2016 is $11.6-million.
