Inogen, Inc. INGN is well-poised for progress within the coming quarters, courtesy of excessive prospects within the moveable oxygen concentrator (POC) house. The optimism, led by strong first-quarter 2024 efficiency and a powerful product portfolio, appears justified. Nevertheless, points like stiff competitors and foreign exchange volatility are main downsides.
The Zacks Rank #2 (Purchase) firm’s shares have risen 106.4% yr up to now in contrast with 9.2% progress of the business. The S&P 500 has elevated 17.7% throughout the identical timeframe.
The famend supplier of POCs has a market capitalization of $268.7 million. The corporate tasks 56.6% progress for 2024 and expects to witness continued enhancements in its enterprise. Inogen’s P/S ratio of 0.8X makes its valuation enticing in contrast with the business’s 3.1X.
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Allow us to delve deeper.
Excessive Prospects within the POC Area: We’re optimistic concerning the POCs’ superiority over standard oxygen remedy (often called the supply mannequin). Inogen primarily develops, manufactures and markets revolutionary POCs to ship supplemental long-term oxygen remedy (LTOT) to sufferers affected by power respiratory situations.
INGN’s proprietary Inogen One and Inogen Rove methods focus the air across the affected person to supply a supply of supplemental oxygen anytime, anyplace, with a battery that may be plugged into an outlet. Per a report by Information Bridge Market Analysis, the POCs market was valued at $1.58 billion in 2022 and is anticipated to succeed in $3.03 billion by 2030 at a CAGR of 8.5%.
Product Portfolio: We’re optimistic about Inogen’s increasing product portfolio. The corporate has acquired the FDA 510(ok) clearance for the Inogen Rove 4, which is ready to be launched quickly. The Rove 4 will supply sufferers a brand new circulation setting in comparison with the sooner variations, a service lifetime of as much as eight years and highest oxygen manufacturing. It’s also the lightest POC out there.
Inogen launched Rove 6 within the U.S. market in July 2023. The Inogen Rove 6 is the primary POC with an anticipated service lifetime of eight years.
Robust Q2 Outcomes: Inogen’s sturdy year-over-year uptick in home and worldwide business-to-business gross sales buoys optimism. Stable year-over-year high and bottom-line performances had been encouraging. Additional, the growth of the adjusted gross margin bodes nicely.
On the earnings name, administration confirmed that focusing on hospitals along with particular person practitioners by way of its rental enterprise gave earlier entry to sufferers of their care pathway, rising the period over which INGN can obtain funds. By increasing its scale, effectivity and throughput within the rental channel, Inogen expects to drive increased profitability over time.
The corporate can also be seeing price advantages within the type of decrease gross sales and advertising bills on the again of the current exit of its third-party relationship within the rental channel. These components elevate optimism concerning the inventory.
Dangers
Stiff Competitors: The LTOT market has intense industrial competitors. Inogen faces competitors from a number of POC producers and distributors in addition to suppliers of different LTOT providers, akin to house supply of oxygen cylinders or tanks. Given the comparatively easy regulatory path within the oxygen remedy system manufacturing market, Inogen expects the business to develop into more and more aggressive sooner or later.
Foreign exchange Volatility: The overseas market accounts for a sizeable quantity of INGN’s earnings. Administration anticipates abroad revenues to proceed to be erratic because of the distributor’s measurement and timing. Within the close to future, INGN additionally expects unfavorable overseas change charges to hinder income progress for the reason that U.S. greenback is rising relative to the euro and different foreign exchange.
Estimate Development
Inogen has been witnessing an bettering estimate revision development for 2024. Prior to now 60 days, the Zacks Consensus Estimate for its loss per share has narrowed 11.4% to $1.95.
The Zacks Consensus Estimate for 2024 revenues is pegged at $327 million, suggesting a 3.6% decline from the year-ago reported quantity.
Inogen, Inc Worth
Inogen, Inc value | Inogen, Inc Quote
Key Picks
Another top-ranked shares within the broader medical house are Boston Scientific, AxoGen AXGN and SiBone SIBN, every carrying a Zacks Rank #2 at current.
Boston Scientific’s shares have risen 58.4% previously yr. Estimates for the corporate’s earnings per share have remained fixed at $2.40 for 2024 and $2.71 for 2025 previously 30 days. BSX’s earnings beat estimates in every of the trailing 4 quarters, delivering a median shock of seven.2%. Within the final reported quarter, it posted an earnings shock of 6.9%.
Estimates for AxoGen’s 2024 loss per share have remained fixed at 1 cent previously 30 days. Shares of the corporate have surged 145% previously yr in contrast with the business’s progress of 15.5%. AXGN’s earnings surpassed estimates in every of the trailing 4 quarters, the typical shock being 96.5%. Within the final reported quarter, it delivered an earnings shock of 200%.
Estimates for SiBone’s 2024 loss per share have remained fixed at 89 cents previously 30 days. Shares of the corporate have misplaced 30.4% previously yr towards the business’s 15.5% progress. SIBN’s earnings surpassed estimates in every of the trailing 4 quarters, the typical shock being 13.4%. Within the final reported quarter, it delivered an earnings shock of 15.4%.
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