UBS Global Research moved Medartis Holding AG up to a "buy" from "neutral" and raised its 12-month price target to CHF97 from CHF87, driven primarily by stronger-than-expected traction for the company's Keri TOUCH thumb prosthesis in the United States.
The bank described Medartis as "a compelling growth story in European MedTech," highlighting an expected core EBITDA compound annual growth rate of roughly 20% for the company, versus an estimated 12% for peer groups.
UBS said its upgrade reflects a U.S. launch it views as "well on track" since the start of 2026. By May, Medartis had provided training to 70 surgeons in the United States and about 50 of those trained surgeons had already implanted a Keri TOUCH prosthesis.
The analysts reiterated the company’s target of around 1,200 TOUCH cases in 2026, a volume UBS translates to roughly CHF6.2 million in sales for the year based on an assumed reimbursement rate near CHF5,200 per procedure.
As a result of the early adoption, UBS raised its forecast for U.S. market penetration of TOUCH to approximately 10% by 2030, up from a prior estimate near 5%. At current reimbursement assumptions, that 10% penetration level equates to about CHF76 million in U.S. TOUCH sales, a level UBS noted is "in line with company targets."
UBS also modelled scenarios around higher and lower uptake. Under a 15% penetration case, U.S. TOUCH sales could reach CHF114 million, which the bank said would be consistent with a CHF140 per share valuation. Conversely, a downside 5% penetration projection corresponds to CHF38 million in sales and a CHF65 per share valuation.
On company-wide financials, UBS now forecasts full-year 2026 organic revenue growth of 18.0% to CHF332 million, modestly ahead of consensus at CHF330 million. The bank expects a core EBITDA margin of 19.1% for 2026, citing that figure as above the CHF59 million consensus metric.
UBS raised its earnings per share estimates for 2026 through 2028 by an average of 7%, leaving its EPS projections 6% to 10% above consensus across that period. The analysts see core EBITDA margin expanding from 18.4% in fiscal 2025 to about 22.3% by fiscal 2030, the improvement driven by a stronger sales mix and operational leverage.
Free cash flow conversion is forecast to reach roughly 29% of EBITDA by fiscal 2030, despite roughly CHF36 million of outstanding earn-out payments linked to Keri. UBS noted Medartis' current 2026 EV/EBITDA multiple is about 17.7 times, a premium to orthopaedic peers at approximately 13 times and to Swiss MedTech peers at about 16 times, a premium the bank characterises as justified by Medartis' superior growth profile.
The valuation underpinning UBS's view uses a discounted cash flow framework with a weighted average cost of capital of 7.6%, a terminal growth rate of 2.5% and a terminal EBITDA margin of 21%.
Investors will next look to Medartis' first-half results, scheduled for release on Aug. 18, as the next major company catalyst.