Varex Imaging (VREX) Stock Forecast & Price Target

Varex Imaging Corp has demonstrated robust growth in both its Medical and Industrial segments, with the Industrial segment achieving a record quarterly revenue of $76.8 million, reflecting a year-over-year increase of 25.3%, while the Medical segment also grew by 5.3% to $152.1 million. The company's strategic initiatives, including diversifying manufacturing capabilities globally and entering new markets like India for radiographic detector production, position it well for continued revenue growth and margin improvements. Additionally, there are positive signs of stabilization in China and increasing order expectations for 2026, along with ongoing advancements in photon counting CT technology that could enhance its competitive edge in the market.

Varex Imaging faces significant headwinds due to the ongoing trade tensions between the U.S. and China, which could adversely affect approximately 15% of its total revenues and have complicated the importation of materials. Additionally, the company's sales into the Chinese market have been hindered by anti-corruption initiatives enforced by the Chinese government, contributing to a year-over-year decline in cash and marketable securities by $58 million. Although there may be expectations for higher orders by 2026, the immediate cost impacts and operational challenges stemming from these international relations raise concerns about Varex Imaging's near-term financial stability.