GICS Sector : Healthcare
TELA Bio, Inc., a commercial-stage medical technology company, focuses on providing soft-tissue reconstruction solutions that optimize clinical outcomes by prioritizing the preservation and restoration of the patient's anatomy.It provides a portfolio of OviTex Reinforced Tissue Matrix (OviTex) products for hernia repair and abdominal wall reconstruction; and OviTex PRS Reinforced Tissue Matrix products to address the unmet needs in plastic and reconstructive surgery, as well as OviTex for Laparoscopic and Robotic Procedures, a sterile reinforced tissue matrix derived from ovine rumen with polypropylene fiber intended to be used in laparoscopic and robotic-assisted hernia surgical repairs.The company markets its products through a single direct sales force, principally in the United States.
Otelo Bio reported a 9% year-over-year increase in revenue to $20.7 million for Q3 2025, with OviTex unit sales growing 22% and PRS unit sales growing 3%. The gross margin remained stable at 68%, resulting in a gross profit of $14 million, up from $12.9 million in the same period last year. However, the company's EPS came in at -$0.19, missing estimates of -$0.17. The revenue growth was driven by the expanding presence in the soft tissue restoration market, with the company achieving a significant milestone of 100,000 implantations of OviTex and OviTex PRS combined globally.
Publication Date: Nov -16
The company continued to make progress in expanding its market presence, both in the US and abroad. In Europe, Otelo Bio advanced awareness through targeted surgeon engagement, including a July cadaver lab with 30 key surgeons, and made meaningful progress with the UK NHS value-based procurement initiative, securing NHS finance sign-off in September. The company's sales force efficiency has also improved, dropping from almost 90% to over 70% of sales in the past three quarters, driven by enhanced training programs and a faster ramp in productivity.
Otelo Bio ended Q3 2025 with $29.7 million in cash and cash equivalents, reflecting cash consumption of $5.7 million in the quarter. The company has strengthened its balance sheet through a comprehensive financing initiative, including the refinancing and upsizing of its debt facility from $40 million to $60 million, and a $13 million equity offering. This is expected to add approximately $26 million in incremental net cash to the balance sheet, providing a comfortable cash runway and allowing the company to focus on delivering consistent execution and capturing growth opportunities.
With a P/S Ratio of 0.51, Otelo Bio's stock appears to be reasonably valued relative to its revenue. However, the company's negative EPS and high P/B Ratio of 4.94 may indicate that the stock is priced for high growth expectations. Analysts estimate next year's revenue growth at 17.9%, which may be challenging to achieve given the company's current cash burn rate. The EV/EBITDA ratio of -1.39 also suggests that the company's valuation is sensitive to its ability to achieve profitability.
TELA Bio to Participate in the Piper Sandler 37th Annual Healthcare Conference
Nov -19
TELA Bio Announces Inducement Grants Under Nasdaq Listing Rule 5635(c)(4)
Nov -17
These Analysts Cut Their Forecasts On TELA Bio After Q3 Earnings
Nov -14
TELA Bio, Inc. (TELA) Q3 2025 Earnings Call Transcript
Nov -14
TELA Bio, Inc. (TELA) Reports Q3 Loss, Misses Revenue Estimates
Nov -13
TELA Bio Announces Pricing of $13.0 Million Underwritten Registered Direct Offering of Common Stock and Pre-Funded Warrants
Nov -13
TELA Bio Reports Third Quarter 2025 Financial Results and Refinancing and Upsizing of Credit Facility
Nov -13
TELA Bio Announces Addition of Betty Jo Rocchio to Board of Directors and the Departure of Director Lisa Colleran
Oct -09
TELA Bio's soft-tissue reconstruction solutions are driven by increasing demand for biocompatible and absorbable implants, growing adoption in orthopedic and general surgery, and expanding presence in the US and international markets. Additionally, the company's proprietary Ovitex technology and strong clinical trial results contribute to its 10.55% growth.
A portfolio of reinforced bioscaffolds designed for soft tissue repair and reconstruction, featuring a unique combination of strength, durability, and biocompatibility.
A specific type of reinforced bioscaffold designed for single-stage implantation, featuring a unique combination of strength, durability, and biocompatibility.
A type of reinforced bioscaffold designed for two-stage implantation, featuring a unique combination of strength, durability, and biocompatibility.
A type of reinforced bioscaffold designed for plastic and reconstructive surgery, featuring a unique combination of strength, durability, and biocompatibility.
TELA Bio, Inc. operates in the medical technology industry, which has a moderate threat of substitutes. While there are alternative treatments and products available, TELA Bio's products are differentiated by their unique characteristics and benefits, reducing the threat of substitutes.
TELA Bio, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products are often critical to customers' operations, making it difficult for customers to negotiate prices or switch to alternative suppliers.
TELA Bio, Inc. relies on a few key suppliers for critical components, which gives these suppliers some bargaining power. However, the company's size and scale of operations also give it some negotiating power, mitigating the impact of supplier bargaining power.
The medical technology industry has high barriers to entry, including significant research and development costs, regulatory hurdles, and the need for specialized expertise. These barriers make it difficult for new entrants to enter the market, reducing the threat of new entrants.
The medical technology industry is highly competitive, with many established players and a high level of innovation. TELA Bio, Inc. faces intense competition from other companies, which drives up marketing and R&D expenses and puts pressure on prices and margins.
| Value | |
|---|---|
| Debt Weight | 68.51% |
| Debt Cost | 8.90% |
| Equity Weight | 31.49% |
| Equity Cost | 8.90% |
| WACC | 8.90% |
| Leverage | 217.57% |
Value: 7.0
Growth: 5.8
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