What happened

Shares of Vericel (VCEL -2.44%), a healthcare company focused on sports medicine and severe burn care, were up 11% as of 3:08 p.m. EST in the wake of strong third-quarter results. 

So what

The key numbers from Varicel's third quarter looked great:

  • Revenue rose 36% to $30.5 million. That was well ahead of the $26.8 million in revenue that Wall Street had expected.
  • Gross margin expanded 500 basis points to 69%.
  • Net income was $3.5 million, or $0.07 per share. That was far better than the $0.02 net loss per share that analysts were expecting.
  • Cash balance at quarter-end was $75 million.

The strong Q3 results allowed management to raise its full-year guidance. Revenue is now expected to land between $116 million and $118 million. That's above its previous guidance range of $112 million to $116 million, and also comfortably ahead of the $115.3 million that Wall Street was expecting.

Rising blue and orange stock chart

Image source: Getty Images.

Given the beat-and-raise quarter, it's not hard to figure out why the stock is flying high today.

Now what

It was a stellar quarter all around, and investors should be particularly excited by the jump to profitability. With Varicel management clearly executing well and a $2 billion addressable market opportunity ahead, this looks like a great growth stock for healthcare investors to get to know.