1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Metrics vs Peers
3. Price Chart
4. Valuation
5. Offer Terms
6. Financial Statements
Discussion
Research report, target price, DCF and forensic scores are for subscribers. View plans
Symbol
RXST
Listed on
2021-07-30
Sector
Health Care
Subsector
Health Care Equipment & Supplies
Offer Price
$16.00
first filed $16.00–$18.00Shares Offered
7.35M
27.31M
$424.3M
26.9%
Implied Upside vs Midpoint
Description
We are a commercial-stage medical technology company dedicated to improving the vision of patients following cataract surgery. Our proprietary RxSight Light Adjustable Lens system (“RxSight system”), comprised of our RxSight Light Adjustable Lens (“LAL”), RxSight Light Delivery Device (“LDD”) and accessories, is the first and only commercially available intraocular lens (“IOL”) technology that enables doctors to customize and optimize visual acuity for patients after cataract surgery. Our LAL is made of proprietary photosensitive material that changes shape in response to specific patterns of ultraviolet (“UV”) light generated by our LDD. With the RxSight system, the surgeon performs a standard cataract procedure to implant the LAL, determines refractive error with patient input after healing is complete, and then uses the LDD to modify the lens with the exact amount of visual correction needed to achieve the patient’s desired vision outcomes. Alternative IOL technologies, in contrast, are not adjustable following the surgery and therefore require patients to make pre-operative choices about their visual preferences, which can often result in patient dissatisfaction when visual outcomes fail to meet expectations. We designed our system to maximize patient and doctor satisfaction through superior visual outcomes. In the pivotal study that formed the basis for our U.S. Food and Drug Administration, or FDA, approval, the observed rate of eyes with 20/20 or better uncorrected distance visual acuity for our LAL was 70.1%. This compares favorably to the results of pivotal studies with similar study designs and patient populations that supported FDA approval of Alcon’s Acrysof Toric (38.4%), and J&J’s Tecnis Toric (43.6%). We began commercializing our solution in the United States in the third quarter of 2019 and are focused on establishing the RxSight system as the standard of care for premium IOL procedures. As of March 31, 2021, we had an installed base of 105 LDDs in ophthalmology practices, and since our inception, surgeons have performed over 10,000 surgeries with our RxSight system. Cataract surgery is the most common surgical procedure in the world, with approximately 22 million cataract surgeries performed worldwide in 2020, including 3.7 million in the United States. A cataract is a loss of transparency in the normally clear lens of the eye that can cause blurry or hazy vision, significantly interfering with daily activities and affecting quality of life. Cataracts increase in prevalence with age and develop in approximately 50% of individuals by age 60, affecting both eyes 80 to 90% of the time, and requiring surgery to restore vision in most cases. During cataract surgery, the patient’s natural lens is replaced with a clear artificial lens called an intraocular lens. There are two broad categories of IOLs: conventional IOLs and premium IOLs. Based on the category of IOL used, cataract surgeries can be differentiated as either conventional or premium procedures. In conventional cataract surgery, patients receive conventional monofocal IOLs that are designed to provide vision at one distance, and do not correct for corneal astigmatism and presbyopia. Nearly all conventional IOL patients therefore will need spectacles to attain their best vision after surgery. With premium cataract surgery, patients receive premium IOLs designed to correct for corneal astigmatism and/or presbyopia and therefore to provide for reduced spectacle dependence. Because 60% of cataracts patients rate being spectacle free after cataract surgery as extremely important, we believe the premium IOL market is underpenetrated as only 11% and 16% of total procedures worldwide and in the United States in 2020, respectively, were premium procedures. However, according to MarketScope, the premium IOL market represented 37% of the total IOL market for 2020, due to higher lens pricing, and is projected to grow significantly faster. According to MarketScope, the premium IOL market was an approximately $1.4 billion market worldwide in 2020, and while total worldwide cataract procedure volumes were down approximately 25% due to the COVID-19 pandemic, the total revenue from premium IOLs to manufacturers was unchanged from 2019. This market is expected to grow at a compound annual growth rate (“CAGR”) of 14% from 2020 to 2026, relative to an approximately $2.3 billion market in 2020 and a 10.5% CAGR for the conventional IOL market. Premium cataract procedures are between 10 and 15 times more profitable for doctors and ophthalmology practices than conventional cataract procedures. The premium IOL market is also less impacted by changes in reimbursement because patients are required to pay out-of-pocket to cover the full or incremental costs of premium cataract procedures (depending on the country), while healthcare payors typically cover the full cost of conventional cataract procedures. We believe that the premium IOL market remains underpenetrated due to doctors’ reluctance to recommend premium IOL offerings to the full universe of eligible patients and patients’ confusion in assessing the tradeoffs associated with the wide range of commercially available premium IOL offerings. We believe current premium IOL offerings often cannot deliver on patient expectations with respect to the patient’s ability to see at near, intermediate and far distances without reliance on spectacles. Once a patient has selected a premium IOL, the surgeon must rely on a series of pre-operative diagnostic tests and predictive formulae to choose a lens that delivers the accuracy and outcomes desired by the patient. According to published clinical data from the pivotal studies of alternative premium IOL technologies, the percentage of patients that achieved 20/20 vision with both eyes at all distances was only 40%. As a result, doctors often lack confidence in current premium IOL offerings given their inability to meet patients’ expectations consistently. We designed our RxSight system to address the shortcomings of existing premium IOL technologies and provide a solution that doctors can trust to improve visual outcomes. In contrast to alternative premium IOL solutions, for which patients are required (before surgery) to specify their visual priorities and willingness to accept optical trade-offs associated with those choices, our RxSight system offers peace of mind that patients can iterate their final vision characteristics with customized post-surgical adjustments. The surgeon first performs a standard cataract implant procedure, replacing the patient’s natural lens with the LAL. Approximately three weeks post cataract surgery, after healing has occurred, the patient undergoes a standard post-operative refraction to determine the refractive error and the prescription required to give the patient the best vision. This prescription is much like that used for spectacle lenses, but instead is used as an input to the LDD. To adjust the LAL, the patient is positioned at the LDD for a treatment that lasts between approximately 30 seconds and 2.5 minutes, depending on the required prescription. The patient returns after approximately three to five days, at which time they can undergo another refraction and adjustment, if needed, to “dial in” their best vision. Once the patient and the doctor are satisfied, then the adjustment is locked in for life with another light treatment. While up to three post-surgical adjustment visits are offered by the doctor, in our pivotal clinical study, patients had an average of 1.6 adjustments. While many patients choose to have both eyes corrected for distance, approximately 80% elect for what is called a blended vision approach that takes advantage of the LAL’s depth of focus to deliver a customized blended vision solution. By titrating the correction for near, intermediate or far in each eye, this approach provides excellent vision with both eyes at all distances. Our RxSight system has FDA approval for the reduction of residual astigmatism to improve uncorrected visual acuity after removal of the cataractous natural lens by phacoemulsification and implantation of the intraocular lens in the capsular bag, in adult patients with pre-existing corneal astigmatism of > 0.75 diopters and without pre-existing macular disease. Our system has also received the CE mark and marketing approval in Mexico for improving uncorrected visual acuity by adjusting the LAL power to correct residual postoperative refractive error, including for -2.0 to + 2.0 diopters of sphere and -3.0 to -0.50 diopters of cylinder and by changing lens curvature to introduce controlled amounts of spherical aberration (+/- 1 micron) and center near add (up to 2.0 diopters). We are currently focusing our commercial efforts in the United States. Our commercial strategy is focused on a “land and expand” model through which we aim to drive new customer adoption, which generally begins with the sale of an LDD, and then helps the customer incorporate the LAL into their practice to drive utilization and premium procedure growth. We believe this commercial strategy, over time, may provide a degree of predictability in terms of our commercial growth and a consumable revenue stream from sales of our LALs. We are currently focused on driving adoption with ophthalmology practices performing a high volume of premium cataract procedures. MarketScope estimates that there are approximately 4,000 surgeons that perform cataract surgeries in the United States, and we estimate approximately 1,600 surgeons performed approximately 70 to 80% of the premium procedures in the United States in 2020. We believe this provides an attractive and concentrated market opportunity addressable with a focused sales force. We currently employ a sales team that, as of March 2021 includes 6 sales directors, and a group of over 40 clinical specialists, field service and customer service personnel. While we intend to initially focus our growing commercial efforts in the United States, in the future, we may selectively pursue commercial expansion in Japan, Europe, Australia or other geographies with significant market opportunity for premium IOLs. Our near-term research and development activities are focused on enhancements to the RxSight system to improve the patient and doctor experience, expand the range of patients that can be treated, as well as expand its indications. We believe that over time, our adjustable lens solution can be used to address a broad range of cataract surgery patients, including those that would otherwise elect for a conventional cataract procedure today. --- We were incorporated in California on March 5, 1997 as Calhoun Vision, Inc. and changed our name to RxSight, Inc. in October 2016. We reincorporated in Delaware on July 6, 2021. Our principal executive offices are located at 100 Columbia, Aliso Viejo, CA 92656. Our telephone number is (949) 521-7830. Our website address is www.rxsight.com.
| Metric | Value | Peer median | Among peers | Trend |
|---|---|---|---|---|
EV / revenue | 29.6x | 13.8x | ||
Price / earnings | 15.4x | — | — | |
Revenue growth | 555% | 41.6% | ||
Gross margin | 11.6% | 56.7% | ||
Operating margin | -241% | -66.4% | ||
Net margin | 188% | -65.1% | ||
Free cash flow margin | -257% | -57.4% | ||
Rule of 40 | 340% | 9.1% | ||
Net cash / market cap | -2.5% | 1.7% | ||
Debt / equity | neg. equity | 0.00 | ||
Current ratio | 7.03 | 3.53 | ||
Stock comp / revenue | 28.5% | 2.3% | ||
9 premium metrics: DCF value / price, Growth the price needs: how common, Last 12 months vs full year and 6 more Unlock | ||||
▼ Priced at $16.00, 6% below the midpoint of the first filed range ($16.00–$18.00, 2021-07-26).
Each filing is plotted ahead of the first trading day on the price chart.
| Filed | Form | Price range | Price | Shares offered | Deal size |
|---|---|---|---|---|---|
| 2021-07-26 | S-1/A | $16.00–$18.00 | — | 7,350,000 | $125.0M |
| 2021-07-28 | S-1/A | $16.00–$18.00 | — | 7,350,000 | $125.0M |
| 2021-07-30 | 424B4 | — | $16.00 | 7,350,000 | $117.6M |
RxSight, Inc. income statement and balance sheet, FY Dec 2022 to FY Dec 2025, as reported in SEC filings.
| Metric | FY Dec 2022after listing | FY Dec 2023after listing | FY Dec 2024after listing | FY Dec 2025after listing |
|---|---|---|---|---|
| Revenue | $49.0M | $89.1M | $140M | $134M |
| Gross profit | $21.3M | $53.8M | $98.9M | $103M |
| Operating income | ($63.3M) | ($50.1M) | ($36.9M) | ($48.2M) |
| Net income | ($66.8M) | ($48.6M) | ($27.5M) | ($38.9M) |
| Revenue growth | — | 81.8% | 57.1% | −3.9% |
| Gross margin | 43.5% | 60.4% | 70.7% | 76.6% |
| Operating margin | −129% | −56.2% | −26.3% | −35.8% |
| Net margin | −136% | −54.6% | −19.6% | −29.0% |
| Metric | FY Dec 2022after listing | FY Dec 2023after listing | FY Dec 2024after listing | FY Dec 2025after listing |
|---|---|---|---|---|
| Total assets | $150M | — | $319M | $312M |
| Total liabilities | $60.3M | — | $37.3M | $36.1M |
| Total equity | $89.9M | $160M | $281M | $276M |
| Cash & equivalents | $11.8M | $10.4M | $16.7M | $19.9M |