A Look at AVITA Medical (RCEL) Valuation Following CEO Change and Preliminary Q3 Revenue Miss

AVITA Medical (RCEL) shares have drawn attention after Chairman Cary Vance was named Interim CEO, replacing Jim Corbett. This leadership shift comes as preliminary third-quarter revenue comes in below expectations and ongoing talks with lenders continue.

See our latest analysis for AVITA Medical.

Shares of AVITA Medical have struggled through 2025, with the 1-day share price return plunging 25.84% after the CEO transition and softer revenue update. Short-term momentum has clearly faded. With a year-to-date share price return of -68.80% and a one-year total shareholder return of -62.46%, investors are recalibrating their risk appetite as leadership uncertainty and financial pressures persist.

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After months of steep declines and a sharp response to the leadership shakeup, is AVITA Medical’s stock now trading at distressed levels that could offer deep value? Or has the market already priced in every ounce of potential recovery?

Most Popular Narrative: 51.7% Undervalued

With AVITA Medical’s last close at $3.99, the narrative’s suggested fair value of $8.26 suggests the market could be ignoring the company’s full recovery potential. This sharp disconnect between narrative valuation and price hints at high expectations for an operational rebound.

Operational efficiency improvements, including a restructuring of the U.S. sales force and tighter cost controls, are expected to yield $10 million in annual expense reductions. This would support better net margins and provide a path to GAAP profitability and positive cash flow by mid or late 2026.

Read the complete narrative.

Want to dig into what’s fueling this massive value gap? This narrative is built on a bold turnaround plan, with aggressive margin assumptions and a transformative earnings climb. Curious about the assumptions underlying these projections? Unpack the rationale and judge for yourself. Could the real recovery still be ahead?

Result: Fair Value of $8.26 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent reimbursement hurdles or slower than expected RECELL adoption in new indications could still undermine the bullish recovery thesis and delay any turnaround.

Find out about the key risks to this AVITA Medical narrative.

Build Your Own AVITA Medical Narrative

If the current perspective does not suit your view or you would rather reach your own conclusions, you can quickly generate a personal narrative using our tools. Do it your way.

A great starting point for your AVITA Medical research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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