Stifel cuts Inspire Medical stock target to $190 from $200

On Tuesday, Stifel analysts adjusted their outlook on Inspire Medical Systems (NYSE:INSP), reducing the price target to $190 from the previous $200 while maintaining a Hold rating on the stock. The revision follows a period of fluctuating stock performance and a recent presentation by the company's management. According to InvestingPro data, analyst targets for INSP currently range from $190 to $270, with four analysts recently revising their earnings expectations upward for the upcoming period.

Inspire Medical (TASE:PMCN)'s stock experienced an unexplained rise earlier in January, which coincided with management's reassurance during a mid-December Stifel Bus Tour. They indicated that the anticipated late-2024 procedure delays were avoided, ahead of the launch of their new product, Inspire V. This news appeared to have mitigated investor concerns about potential impacts on fourth-quarter 2024 outcomes.

However, despite a revenue beat in the fourth quarter of 2024, the year-over-year utilization rates remained unchanged. This, coupled with the fact that only a few procedures using Inspire V have been conducted in the United States, and the lack of detailed reimbursement information, has led to concerns about the initial uptake of the new product. These factors may have contributed to the downward pressure on Inspire Medical's shares observed last week.

Analysts noted that while the recent pullback in share price has made the valuation of Inspire Medical more attractive, there are ongoing concerns. One of the most significant issues highlighted is the limited potential for future revenue growth, especially looking towards 2026, despite impressive revenue growth of 32.5% in the last twelve months.

The analysts emphasized the need for increased confidence in the acceleration of utilization growth in the upcoming quarters before considering any change to their Hold rating. InvestingPro analysis indicates the stock is currently overvalued, though it maintains a GREAT financial health score of 3.29. Subscribers to InvestingPro can access 11 additional exclusive insights and a comprehensive Pro Research Report for deeper analysis of INSP's valuation metrics and growth potential.

In their commentary, Stifel analysts expressed that further clarity on Inspire V's reimbursement, which was initially skirted during a fireside chat, was expected to be provided at a subsequent conference hosted by J.P. Morgan. The outcome of this conference may be a key factor in determining the future sentiment and performance of Inspire Medical's stock.

In other recent news, Inspire Medical Systems has been making notable strides in its financial performance. Piper Sandler has maintained an overweight rating on Inspire Medical's stock, following a solid performance in the fourth quarter, despite some disruptions caused by hurricanes. The company reported impressive revenue growth of 32.52% and an industry-leading gross margin of 84.77% over the last twelve months.

Inspire Medical's fourth quarter 2024 revenue exceeded analysts' expectations, coming in between $239.5 million and $239.7 million, surpassing the consensus estimate of $232 million. The company's full-year 2025 revenue guidance aligns closely with the consensus of $950.7 million.

RBC Capital Markets has also provided a favorable outlook for the Medical Supplies & Devices sector for 2025, highlighting Inspire Medical as a dominant player in treating obstructive sleep apnea. Analysts at Truist Securities increased the price target for Inspire Medical Systems shares to $250 from the previous $240 while maintaining a Buy rating, following the company's third-quarter revenue outperformance and significant earnings per share beat.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.