KMTS Stock: This Medtech Grew 66% and Fell 8% — Here’s Why

Kestra Medical Technologies (KMTS) Q4 FY2026 — Kestra Medical grew fiscal Q4 revenue 66% to $28.6M (FY26 +59% to $95.1M) and expanded gross margin to 54.8% — its 10th straight quarter of gains — but its adjusted EBITDA loss widened to $27M, EPS missed, and it guided FY27 revenue to $137M (+44%, a deceleration). The stock fell ~8.5% to ~$22. Kestra makes the ASSURE wearable defibrillator and is the challenger to ZOLL's LifeVest in a two-player market — growing 59% while the market grows low-to-mid teens, so it's taking real share. The equity story is a gorgeous gross-margin ramp (40.5% to 54.8% in a year, targeting 70%+). So why did it fall 8%? The loss WIDENED (adj. EBITDA -$20M to -$27M), the guide decelerated to +44%, and management gave no path-to-breakeven date. At ~8x forward sales after the drop, it's a reasonable price for the growth — a SPECULATIVE BUY, with the risk that losses take longer to inflect than hoped. THE CALL: SPECULATIVE BUY (3/5, GREAT TOP LINE, UNPROVEN BOTTOM LINE) — base-case value ~$27 vs ~$22 today. What to watch: the first sign losses are inflecting (a narrowing EBITDA loss or a breakeven date), the collections/in-network conversion rate, and the share count Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.