Tigress Financial lowers Medline stock price target on fire impact

Tigress Financial Partners has reduced its target price for Medline Inc stock from $62 to $55, while retaining a Buy rating. The stock currently trades at $34.23, down nearly 20% in the past week and near the 52-week low of $32.81. The company's AI-enabled supply-chain transformation is seen as a driver of long-term growth, according to Tigress.

Despite recent fire-related costs, the firm believes Medline's rapid recovery and strong supply-chain platform present a buying opportunity. The firm highlighted Medline's volume growth, customer wins, and expanding supply-chain platform as supporting a bullish outlook. With revenue growth of 12% over the past year, the stock appears undervalued at current levels.

The Tracy fire created significant near-term costs, but Tigress noted the company's supply-chain platform's strength and prime vendor wins creating recurring revenue, market-share, and proprietary-product growth. Medline's scale, product-mix expansion, and AI-enabled supply chain are expected to improve business performance trends and accelerate economic profit growth.

The company's $375 billion global total addressable market offers a long runway for share gains and above-market growth.