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Here's Why You Should Retain Inogen (INGN) Stock for Now
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Inogen, Inc. (INGN - Free Report) is well-poised for growth in the coming quarters, courtesy of its high prospects in the portable oxygen concentrator (POC) space. The optimism is led by solid fourth-quarter 2022 performance and a strong product portfolio. Headwinds resulting from stiff competition and foreign exchange fluctuations are major downsides.
Over the past year, th Zacks Rank #3 (Hold) stock has lost 60.9% compared with the 16.3% decline of the industry and 14.2% fall of the S&P 500.
This renowned provider of POCs has a market capitalization of $285.1 million. The company projects 40.1% growth for 2024 and expects to witness continued improvements in its business. Inogen surpassed the Zacks Consensus Estimate in all the trailing four quarters, delivering an earnings surprise of 44.2%, on average.
Image Source: Zacks Investment Research
Let’s delve deeper.
High Prospects in the POC Space: We are optimistic about the POCs’ superiority over conventional oxygen therapy (known as the delivery model). POCs provide unlimited oxygen supply anywhere, thereby enhancing patient independence and mobility. Management at Inogen expects this to have a positive impact on its industry and POC adoption.
Product Portfolio: We are optimistic about Inogen’s expanding product portfolio. The company provides oxygen concentrator solutions for portable and stationary use. On the fourth-quarter 2022 earnings call in February, management confirmed that in December 2022, Inogen received the FDA’s clearance for Rove 4. The company’s management anticipates the U.S. launch in the back half of 2023.
Strong Q4 Results: Inogen’s robust year-over-year uptick overall, as well as rental and sales revenues in fourth-quarter 2022, buoys optimism. The strength in domestic and international business-to-business sales was encouraging. On the earnings call, management confirmed that it plans to drive further differentiation for Inogen and chronic obstructive pulmonary disease with anticipated new product launches in 2023 in the United States and Europe following regulatory clearances. This raises our optimism about Inogen.
Downsides
Stiff Competition: The long-term oxygen therapy (LTOT) market is a highly competitive industry. Inogen competes with several manufacturers and distributors of POC and providers of other LTOT solutions, such as home delivery of oxygen tanks or cylinders. Given the relatively straightforward regulatory path in the oxygen therapy device manufacturing market, Inogen expects that the industry will become increasingly competitive in the future.
Forex Woes: Inogen generates a significant portion of its revenues from the international market. Management expects international revenues to remain lumpy owing to the timing and size of the distributor. It also expects adverse foreign currency exchange rates to impede revenue growth in the near term, owing to the strengthening of the U.S. dollar against the euro and other foreign currencies.
Estimate Trend
Inogen has been witnessing a negative estimate revision trend for 2023. Over the past 90 days, the Zacks Consensus Estimate for its loss per share has widened from $1.81 to $2.07.
The Zacks Consensus Estimate for first-quarter 2023 revenues is pegged at $74.2 million, suggesting a 7.7% decline from the year-ago reported number.
This compares to our first-quarter 2023 revenue estimate of $74.9 million, suggesting a 6.8% decline from the year-ago quarter’s reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and Avanos Medical, Inc. (AVNS - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 15.2%. HOLX’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 30.6%.
Hologic has gained 4.2% against the industry’s 16.3% decline in the past year.
Henry Schein, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 8.1%. HSIC’s earnings surpassed estimates in three of the trailing four quarters and matched the same in the other, the average beat being 2.9%.
Henry Schein has lost 10.6% compared with the industry’s 9.9% decline over the past year.
Avanos, carrying a Zacks Rank #2 at present, has an estimated growth rate of 1.8% for 2023. AVNS’ earnings surpassed estimates in all the trailing four quarters, the average beat being 11%.
Avanos has lost 15.2% compared with the industry’s 16.3% decline over the past year.
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Here's Why You Should Retain Inogen (INGN) Stock for Now
Inogen, Inc. (INGN - Free Report) is well-poised for growth in the coming quarters, courtesy of its high prospects in the portable oxygen concentrator (POC) space. The optimism is led by solid fourth-quarter 2022 performance and a strong product portfolio. Headwinds resulting from stiff competition and foreign exchange fluctuations are major downsides.
Over the past year, th Zacks Rank #3 (Hold) stock has lost 60.9% compared with the 16.3% decline of the industry and 14.2% fall of the S&P 500.
This renowned provider of POCs has a market capitalization of $285.1 million. The company projects 40.1% growth for 2024 and expects to witness continued improvements in its business. Inogen surpassed the Zacks Consensus Estimate in all the trailing four quarters, delivering an earnings surprise of 44.2%, on average.
Image Source: Zacks Investment Research
Let’s delve deeper.
High Prospects in the POC Space: We are optimistic about the POCs’ superiority over conventional oxygen therapy (known as the delivery model). POCs provide unlimited oxygen supply anywhere, thereby enhancing patient independence and mobility. Management at Inogen expects this to have a positive impact on its industry and POC adoption.
Product Portfolio: We are optimistic about Inogen’s expanding product portfolio. The company provides oxygen concentrator solutions for portable and stationary use. On the fourth-quarter 2022 earnings call in February, management confirmed that in December 2022, Inogen received the FDA’s clearance for Rove 4. The company’s management anticipates the U.S. launch in the back half of 2023.
Strong Q4 Results: Inogen’s robust year-over-year uptick overall, as well as rental and sales revenues in fourth-quarter 2022, buoys optimism. The strength in domestic and international business-to-business sales was encouraging. On the earnings call, management confirmed that it plans to drive further differentiation for Inogen and chronic obstructive pulmonary disease with anticipated new product launches in 2023 in the United States and Europe following regulatory clearances. This raises our optimism about Inogen.
Downsides
Stiff Competition: The long-term oxygen therapy (LTOT) market is a highly competitive industry. Inogen competes with several manufacturers and distributors of POC and providers of other LTOT solutions, such as home delivery of oxygen tanks or cylinders. Given the relatively straightforward regulatory path in the oxygen therapy device manufacturing market, Inogen expects that the industry will become increasingly competitive in the future.
Forex Woes: Inogen generates a significant portion of its revenues from the international market. Management expects international revenues to remain lumpy owing to the timing and size of the distributor. It also expects adverse foreign currency exchange rates to impede revenue growth in the near term, owing to the strengthening of the U.S. dollar against the euro and other foreign currencies.
Estimate Trend
Inogen has been witnessing a negative estimate revision trend for 2023. Over the past 90 days, the Zacks Consensus Estimate for its loss per share has widened from $1.81 to $2.07.
The Zacks Consensus Estimate for first-quarter 2023 revenues is pegged at $74.2 million, suggesting a 7.7% decline from the year-ago reported number.
This compares to our first-quarter 2023 revenue estimate of $74.9 million, suggesting a 6.8% decline from the year-ago quarter’s reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and Avanos Medical, Inc. (AVNS - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 15.2%. HOLX’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 30.6%.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 4.2% against the industry’s 16.3% decline in the past year.
Henry Schein, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 8.1%. HSIC’s earnings surpassed estimates in three of the trailing four quarters and matched the same in the other, the average beat being 2.9%.
Henry Schein has lost 10.6% compared with the industry’s 9.9% decline over the past year.
Avanos, carrying a Zacks Rank #2 at present, has an estimated growth rate of 1.8% for 2023. AVNS’ earnings surpassed estimates in all the trailing four quarters, the average beat being 11%.
Avanos has lost 15.2% compared with the industry’s 16.3% decline over the past year.