Laidlaw Reiterates Buy Rating on Beyond Air (XAIR) with $14 Price Target Ahead of Second-Gen LungFit PH Launch

This morning, XAIR reported F4Q26 financial results and corporate updates. Our takeaway is XAIR’s topline, currently and over near-future, is in a steady maintenance condition. This is supported by relatively sticky current and modestly newly added customers for the current 1st-gen LungFit PH sales until the potential 2nd-gen LungFit PH sPMA approval, possibly in 2H26, and the subsequent launch in 2027. This will be an inflection point for increasing XAIR share value. We also believe the change of fiscal year ending as identical to the calendar year could potentially make communication with investors less complicated and confusing. XAIR reported F4Q26 financial results with a net loss of ($10.3MM) vs. Laidlaw ($6.6MM) and the Street ($7.2MM). Net loss per share for the quarter was ($0.77) vs. ($0.49) for Laidlaw and ($0.59) for the Street. XAIR ended the quarter with long-term debt of $21.6MM and $17.3MM cash, supporting operational runway into 2027, in our opinion. In C1Q26 (F4Q26), LungFit PH generated ~$1.91MM sales, below our $2.36MM and the Street $2.3MM estimates. This is a 13% Q/Q topline decline ($2.1MM in F3Q26). For F26, the total $7.7MM revenue is slightly lower than the guided $8 – $10MM. XAIR indicated to change its fiscal yearend from March 31st to December 31st, potentially making discussion with investors less complicated. For the 2026 calendar year, XAIR guided $8MM topline including $1.9MM of C1Q26. XAIR indicated that the 2nd-gen LungFit PH PMA supplement review by the FDA is underway, and we estimate potential approval could slate to 2H26. To successfully achieve this could be a critical catalyst for XAIR share appreciation and a major boost of LungFit PH franchise commercial outlook. XAIR guided that the 2027 revenue could be $16-$18MM with nearly half to come from gen 2 LungFit PH since this might be its first year of launch. We anticipate more material growth could start in 2028 and 2029. We are reiterating our Buy rating and $14 target price.