Expanding Minimally Invasive Procedures Will Open US And European Markets

Key Takeaways

• Accelerating physician adoption and regulatory wins are expanding procedure access, driving robust growth across both domestic and international markets.
  
• Diversifying the product lineup and gaining positive reimbursement trends are enhancing profitability prospects and supporting long-term margin expansion.
  
• Heavy dependence on the U.S. market and regulatory environment, margin compression risks, and intensifying competition threaten SI-BONE's path to sustainable profitability and growth.

Catalysts

A medical device company, focuses on solving musculoskeletal disorders of the sacropelvic anatomy in the United States and internationally.

• The rapidly growing physician base-with active U.S. users up 25% year-over-year and strong onboarding of both new and established doctors-indicates accelerating adoption of SI-BONE's minimally invasive procedures, enhancing future revenue growth and driving increased procedural volume per physician.
  
• Expanding product portfolio and successful recent launches (e.g., iFuse TORQ, Granite 9.5, TNT) are opening new addressable markets within musculoskeletal care and facilitating further penetration into outpatient and ASC settings, supporting top-line revenue expansion and sustainable long-term procedure growth.
  
• Positive shifts in reimbursement (NTAP for TNT, continued pass-through status for Granite, increased CMS outpatient payments, and proposed higher in-office payments for CPT 27278) lower economic barriers for providers and hospitals, directly supporting greater procedure access and higher average selling prices, which should bolster revenue and margins.
  
• International growth catalysts are emerging, as the regulatory launch and early positive reception of iFuse TORQ in Europe are expected to reignite international revenue growth in 2026 and beyond, complementing the already robust U.S. business and diversifying the revenue base.
  
• Continued clinical validation and long-term outcome data are strengthening SI-BONE's competitive position, supporting broader physician adoption and payor acceptance, which increases operating leverage, underpins growing profitability, and sets the stage for margin expansion as the business scales.

SI-BONE Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming SI-BONE's revenue will grow by 14.8% annually over the next 3 years.
• Analysts are not forecasting that SI-BONE will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate SI-BONE's profit margin will increase from -12.8% to the average US Medical Equipment industry of 12.4% in 3 years.
• If SI-BONE's profit margin were to converge on the industry average, you could expect earnings to reach $34.8 million (and earnings per share of $0.74) by about August 2028, up from $-23.8 million today.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 42.1x on those 2028 earnings, up from -28.5x today. This future PE is greater than the current PE for the US Medical Equipment industry at 27.3x.
• Analysts expect the number of shares outstanding to grow by 3.47% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 7.6%, as per the Simply Wall St company report.

SI-BONE Future Earnings Per Share Growth

Risks

• Heavy reliance on the U.S. market (95% of revenue) exposes SI-BONE to geographic concentration risk; any adverse changes in U.S. reimbursement policies, healthcare budget constraints, or competitive pressures could materially impact long-term revenue and earnings.
  
• Management guides for medium-term gross margin compression due to new product launches and increased surgical capacity, meaning margins may decline to 76–77% over the next 2–3 years, potentially constraining net margin expansion and overall profitability.
  
• The company faces ongoing operating losses at the net income level (net loss of $6.2 million this quarter despite positive adjusted EBITDA), indicating that sustained revenue growth and margin improvement are required to achieve continuous profitability and positive free cash flow at scale.
  
• Ongoing success depends on the continued ramp and adoption by new physicians; if procedural density per physician plateaus or surgeon adoption slows due to clinical education hurdles, complexity, or competitive advancements, the pace of revenue and earnings growth could decelerate substantially.
  
• Emerging competition from alternative pain management modalities or advances in non-surgical and regenerative therapies could reduce demand for SI joint fusion, while heightened regulatory burdens (such as real-world evidence requirements for new technologies) could increase compliance costs and lengthen time-to-market, negatively affecting long-term revenue growth and profitability.

Valuation

• The analysts have a consensus price target of $25.0 for SI-BONE based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $32.0, and the most bearish reporting a price target of just $20.0.
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $280.3 million, earnings will come to $34.8 million, and it would be trading on a PE ratio of 42.1x, assuming you use a discount rate of 7.6%.
• Given the current share price of $15.7, the analyst price target of $25.0 is 37.2% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.