Tuesday, analysts at UBS reaffirmed their positive stance on Inspire Medical Systems (NYSE:INSP), maintaining a Buy rating and a price target of $265.00. This aligns with the broader Wall Street sentiment, as InvestingPro data shows a strong Buy consensus with analyst targets ranging from $190 to $270. UBS’s endorsement comes in the wake of Inspire Medical (TASE:PMCN)’s fourth-quarter results for the year 2024, which they believe underscore the company’s continued growth and potential to sustain adoption momentum.
The company’s performance is seen as a reassurance for investors, particularly in light of the ongoing Department of Justice investigation. While acknowledging that the scrutiny could pressure the stock, which has already declined 8.3% over the past week according to InvestingPro data, UBS suggests that such investigations are increasingly typical in the medical technology and healthcare sectors, often culminating in settlements.
Despite the potential for the legal situation to cast a shadow over the company’s stock, UBS views any resultant dip in share price as a compelling buying opportunity. This perspective is bolstered by Inspire Medical’s robust financial health, which InvestingPro rates as "GREAT" with an impressive current ratio of 7.84, indicating strong liquidity. The company maintains a conservative debt profile with a debt-to-equity ratio of just 0.04, while generating positive free cash flow.
UBS’s confidence in Inspire Medical is further supported by the company’s robust fundamentals. The firm anticipates that Inspire Medical is not only positioned to maintain double-digit sales growth - evidenced by its current revenue growth rate of 32.5% - but also to exceed expectations with its earnings per share (EPS) for the year 2025. The guidance provided for 2025 EPS has surpassed consensus estimates, indicating potential for even greater financial leverage in the future. For deeper insights into Inspire Medical’s growth prospects and comprehensive analysis, investors can access the detailed Pro Research Report available on InvestingPro, which covers over 1,400 top US stocks.
In other recent news, Inspire Medical Systems has been in the spotlight following its recent fourth-quarter earnings report, which showed a significant beat on earnings per share (EPS) and revenue that met expectations. RBC Capital Markets has maintained an Outperform rating on Inspire Medical, with a price target of $260, citing the company’s continued profitability and operational excellence. Truist Securities, while lowering its price target from $250 to $235, retained a Buy rating on the company.
Morgan Stanley (NYSE:MS) also adjusted its price target for Inspire Medical, reducing it from $230 to $220 but maintained an Overweight rating. Piper Sandler reiterated an Overweight rating and a $233 price target, highlighting the strong profit and loss leverage of the company. Despite a Department of Justice investigation, Piper Sandler expressed optimism about the company’s future performance.
Leerink Partners slightly raised its price target from $193 to $194, keeping a Market Perform rating. The company’s management has confirmed its sales guidance for the year 2025, aiming for $940-955 million, indicating an increase of 17-19%. Additionally, the company provided a new positive EPS guidance ranging from $2.10 to $2.20, compared to the Street’s expectation of $1.97. These recent developments underline Inspire Medical’s continued growth trajectory and its ability to deliver on its financial goals.
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