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1. Company Snapshot

1.a. Company Description

Tactile Systems Technology, Inc., a medical technology company, engages in the development and provision of medical devices for chronic diseases in the United States.The company offers Flexitouch Plus system, a pneumatic compression device for the treatment of lymphedema; Entre system, a portable pneumatic compression device that is used for the at-home treatment of venous disorders, such as lymphedema and chronic venous insufficiency, including venous leg ulcers; and AffloVest, a portable high frequency chest wall oscillation test for the treatment of retained pulmonary secretions such as bronchiectasis, cystic fibrosis, and various neuromuscular disorders.The company was incorporated in 1995 and is headquartered in Minneapolis, Minnesota.

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1.b. Last Insights on TCMD

Tactile Systems Technology's recent performance was driven by strong Q3 2025 earnings, with revenue increasing 17% year-over-year to $85.8 million and net income growing to $8.2 million. The company's Flexitouch Plus therapy demonstrated sustained benefits in treating lymphedema in head and neck cancer patients. A second share repurchase program of up to $25.0 million was authorized, indicating confidence in the company's financials. Additionally, analysts increased their forecasts after the better-than-expected Q3 earnings, and the company raised its FY2025 sales guidance.

1.c. Company Highlights

2. Tactile Medical's Q3 2025 Earnings: A Strong Performance

Tactile Medical reported a robust financial performance in Q3 2025, with total revenue reaching $85.8 million, representing a 17% year-over-year growth. The company's lymphedema revenue increased 11% year-over-year to $72.4 million, while airway clearance revenue surged 71% year-over-year to $13.4 million. Gross margins improved 80 basis points to 76%, and adjusted EBITDA grew 34% year-over-year to $14.4 million. The company's EPS came in at $0.36, significantly beating estimates of $0.16.

Publication Date: Nov -20

📋 Highlights
  • Total Revenue Growth:: Q3 revenue reached $85.8M, a 17% YoY increase driven by $72.4M in lymphedema (11% YoY) and $13.4M in airway clearance (71% YoY).
  • Adjusted EBITDA Surge:: Adjusted EBITDA rose 34% YoY to $14.4M, with full-year guidance raised to $38M–$39.5M.
  • Revenue Guidance Upgrade:: Full-year 2025 revenue projected at $317M–$321M (8–10% YoY growth), with airway clearance expected to grow 52–55%.
  • Margin Expansion:: Gross margin improved 80 bps to 76%, and operating income surged 62% YoY to $11M.
  • Share Repurchase Program:: $25M initiative launched to repurchase stock, reflecting confidence in business trajectory and shareholder value.

Business Transformation and Product Innovation

The company made significant progress in its business transformation, product innovation, and market leadership. Tactile Medical's CEO, Sheri Dodd, highlighted the company's strategic priorities, including improved access to care, expanding treatment options, and enhancing the lifetime patient value. The company's airway clearance business saw a 71% year-over-year increase in revenue, driven by partnerships with top respiratory DMEs and growing demand for AffloVest.

Guidance and Outlook

Tactile Medical raised its full-year 2025 total revenue guidance to a range of $317 million to $321 million, representing growth of approximately 8% to 10% year-over-year. The company's adjusted EBITDA expectation for 2025 is approximately $38 million to $39.5 million. Sheri Dodd stated that the company's financial performance and operational execution in the third quarter leave them incrementally confident in their ability to achieve and exceed their full-year 2025 expectations.

Valuation and Growth Prospects

With a P/E Ratio of 37.02 and an EV/EBITDA of 17.8, the market is pricing in a certain level of growth for Tactile Medical. Analysts estimate next year's revenue growth at 8.8%. Given the company's strong Q3 performance and raised guidance, it appears that the company is on track to meet or exceed these expectations. The company's commitment to driving profitable growth and increasing shareholder value is evident in its initiation of a second share repurchase program.

Operational Highlights

The company's sales force is well-positioned, with 329 reps, exceeding the goal of 300. Tactile Medical is seeing benefits from its NCD policy, allowing patients with unique characteristics to access advanced pumps directly. The lymphedema revenue growth is driven by expanded headcount, increased productivity, and a strong airway clearance performance. The company is generating meaningful clinical evidence to support improved access to care for currently underrepresented patient groups.

3. NewsRoom

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Tactile Systems Technology (TCMD) is a Great Momentum Stock: Should You Buy?

Nov -28

Source: zacks.com

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Are Medical Stocks Lagging Tactile Systems Technology (TCMD) This Year?

Nov -27

Source: zacks.com

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Best Momentum Stock to Buy for Nov. 19th

Nov -19

Source:

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4 Must-Buy Efficient Stocks to Strengthen Your Portfolio Returns

Nov -19

Source:

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New Strong Buy Stocks for Nov. 19: TCMD, NPSNY, and More

Nov -19

Source: zacks.com

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Tactile Medical to Present at the Piper Sandler 37th Annual Healthcare Conference

Nov -18

Source: globenewswire.com

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Tactile Systems Technology, Inc. (NASDAQ:TCMD) Receives $21.67 Average Price Target from Analysts

Nov -17

Source: defenseworld.net

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All You Need to Know About Tactile Systems Technology (TCMD) Rating Upgrade to Strong Buy

Nov -13

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.32%)

6. Segments

Lymphedema

Expected Growth: 10.3%

Growing prevalence of lymphedema, increasing adoption of innovative solutions, and rising awareness about the condition drive the market growth, with Tactile Systems Technology, Inc. at the forefront with its pioneering treatments.

Airway Clearance

Expected Growth: 10.5%

Growing prevalence of respiratory diseases, increasing adoption of non-invasive therapies, and advancements in wearable technology drive the demand for Airway Clearance devices, fueling market growth.

7. Detailed Products

Flexitouch System

A pneumatic compression device designed to treat lymphedema and other circulatory disorders

ACTitouch System

A pneumatic compression device designed to treat lymphedema and other circulatory disorders in the comfort of one's own home

Entre System

A pneumatic compression device designed to treat venous ulcers and other wounds

8. Tactile Systems Technology, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Tactile Systems Technology, Inc. is medium due to the availability of alternative technologies and products in the market.

Bargaining Power Of Customers

The bargaining power of customers for Tactile Systems Technology, Inc. is high due to the presence of large and established customers who can negotiate prices and terms.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Tactile Systems Technology, Inc. is low due to the availability of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants for Tactile Systems Technology, Inc. is medium due to the presence of barriers to entry, such as high capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Tactile Systems Technology, Inc. is high due to the presence of several established competitors and the need to constantly innovate and improve products.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 20.64%
Debt Cost 3.95%
Equity Weight 79.36%
Equity Cost 10.07%
WACC 8.81%
Leverage 26.01%

11. Quality Control: Tactile Systems Technology, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Tactile Systems Technology

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

27.77$

Current Price

27.77$

Potential

-0.00%

Expected Cash-Flows