Carlsmed Inc (CARL) Stock Forecast & Price Target

Carlsmed Inc. demonstrated a substantial growth trajectory, with revenue in the third quarter reaching $13.1 million, reflecting a 98% year-over-year increase, driven largely by a growing surgeon user base that expanded by over 70%. The company is capitalizing on a sizable $13.4 billion U.S. lumbar fusion market and plans to further increase its total addressable market through a penetration into the cervical market, projected to add approximately 373,000 patients by 2026. Additionally, the gross margin of 75.9% exceeded forecasts, supported by reductions in contract manufacturing costs and lower inventory reserve expenses, contributing to a robust financial foundation for future growth.

The negative outlook on Carlsmed Inc.'s stock is driven by several fundamental concerns, including projected cervical revenue for FY26 falling short of estimates, with anticipated revenue at $2.9 million versus a higher estimate of $3.4 million. Additional risks include slower adoption of the aprevo platform by new surgeons, lower growth rates in the overall spine market, and a potential decline in average selling prices (ASP) coupled with increased operating expenses. Moreover, competitive pressure from larger players and changes in reimbursement policies could further threaten Carlsmed's market position and pricing strategy, contributing to an EBITDA loss of $30.7 million.