Piper Sandler increased its price objective on Tactile Systems Technology (NASDAQ: TCMD) to $42 from $35 and maintained an Overweight rating, following a quarter in which revenue came in ahead of estimates. At the time of the repricing, the new target implies roughly a 50% upside from a reference share price of $28.05.
Market data from InvestingPro included in reports around the move show Tactile Systems trading near its Fair Value, and indicate that two analysts recently raised their earnings estimates for the upcoming period. InvestingPro also reports that Tactile achieved 9.28% revenue growth over the trailing twelve months.
The firm said the fourth-quarter beat was primarily driven by performance in the company’s lymphedema business. Tactile Systems provided fiscal 2026 revenue guidance in a range of $357 million to $365 million, which represents growth of approximately 8% to 11% year-over-year and aligns with the company’s recent growth trajectory. Piper Sandler’s pre-announcement model had stood at $346 million, making the disclosed guidance modestly higher than the firm had expected.
Piper Sandler characterized the guidance as reasonably set and suggested there is potential for upside beyond the guided range if momentum in the lymphedema franchise persists. Management itself expects the lymphedema segment to expand in the 8% to 11% range for fiscal 2026 despite a potential headwind from an upcoming change in reimbursement policy. Specifically, the company flagged the possibility of disruption from the Centers for Medicare and Medicaid Services instituting prior authorization requirements for pneumatic compression devices beginning in April.
To address reimbursement workflow risk, Tactile Systems retains a back-office team with experience processing prior authorizations for commercial payors, a capability management expects will help mitigate authorization-related obstacles. Piper Sandler noted that the firm believes the company’s back-office experience supports the guidance and may reduce downside from that reimbursement change.
Separately, Tactile Systems has completed an acquisition of LymphaTech for an upfront cash payment of $6.8 million, with additional contingent payments tied to future milestones. The acquisition is intended to strengthen Tactile’s ability to serve the lymphedema market. Piper Sandler also highlighted that Tactile’s Afflovest product line consistently exceeded expectations throughout 2025, a pattern the analyst team flagged as a positive operational signal.
In prior coverage, the firm had upgraded Tactile Systems from Neutral to Overweight and previously increased a price target from $20.00 to $35.00, actions the research team tied to stabilization in the lymphedema business and several upcoming catalysts. The latest move to $42 from $35 extends that earlier upward reassessment.
Overall, Piper Sandler’s note frames the company’s fiscal 2026 guidance as achievable and highlights lymphedema performance, an acquisition intended to deepen capabilities, and sustained product outperformance as the primary drivers behind its more bullish stance.