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3 Reasons to Retain Inogen (INGN) Stock in Your Portfolio Now
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Inogen, Inc. (INGN - Free Report) is well-poised for growth in the coming quarters, courtesy of high prospects in the portable oxygen concentrator (POC) space. The optimism, led by solid first-quarter 2024 performance and a strong product portfolio, looks promising. However, issues like stiff competition and forex volatility are major downsides.
The Zacks Rank #3 (Hold) company’s shares have risen 21% year to date compared with 20.9% growth of the industry. The S&P 500 has increased 18.3% during the same time frame.
The renowned provider of POCs has a market capitalization of $212.4 million. The company projects 50.2% growth for 2024 and expects to witness continued improvements in its business. Inogen’s P/S ratio of 0.7X compares favorably with the industry’s 3.1X.
Image Source: Zacks Investment Research
Let us delve deeper.
High Prospects in the POC Space: We are optimistic about the POCs’ superiority over conventional oxygen therapy (known as the delivery model). Inogen primarily develops, manufactures and markets innovative POCs to deliver supplemental long-term oxygen therapy (LTOT) to patients suffering from chronic respiratory conditions.
INGN’s proprietary Inogen One and Inogen Rove systems concentrate the air around the patient to offer a source of supplemental oxygen anytime, anywhere, with a battery that can be plugged into an outlet. Per a report by Data Bridge Market Research, the POCs market was estimated to be $1.58 billion in 2022 and is anticipated to reach $3.03 billion by 2030 at a CAGR of 8.5%.
Product Portfolio: We are optimistic about Inogen’s expanding product portfolio. The company has received the FDA’s 510(k) clearance for the Inogen Rove 4, which will be launched in 2024. The FDA clearance of Inogen Rove 6 was received on Jun 30, 2023, and launched in the U.S. market in July 2023. The Inogen Rove 6 is the first POC with an eight-year expected service life. The eight-year expected service life also extends to the Inogen One G5 POCs.
Strong Q1 Results: Inogen’s robust year-over-year uptick in international business-to-business sales in first-quarter 2024 buoys optimism. Solid year-over-year top and bottom-line performances were encouraging. The robust year-over-year uptick in domestic and international business-to-business sales was also impressive. Further, the expansion of the adjusted gross margin bodes well.
On the earnings call, management confirmed its decision to target hospitals in addition to individual practitioners through its rental business. By expanding its scale, efficiency and throughput in the rental channel, Inogen expects to drive higher profitability over time. The company is also seeing cost benefits in the form of lower sales and marketing expenses on the back of the recent exit of its third-party relationship in the rental channel. These look promising for the stock.
Downsides
Stiff Competition: The LTOT market has intense industrial competition. Inogen faces competition from several POC producers and distributors as well as suppliers of other LTOT services, such as home delivery of oxygen cylinders or tanks. Given the relatively straightforward regulatory path in the oxygen therapy device manufacturing market, Inogen expects the industry to become increasingly competitive in the future.
Forex Volatility: The foreign market accounts for a sizeable amount of INGN's income. Management anticipates overseas revenues to continue to be erratic due to the distributor's size and timing. In the near future, INGN also expects unfavorable foreign exchange rates to hinder revenue growth since the U.S. dollar is increasing relative to the euro and other foreign currencies.
Estimate Trend
Inogen has been witnessing an improving estimate revision trend for 2024. In the past 60 days, the Zacks Consensus Estimate for its loss per share has narrowed 9.5% to $2.20.
The Zacks Consensus Estimate for second-quarter 2024 revenues is pegged at $82.3 million, suggesting a 1.6% decline from the year-ago reported number.
Some better-ranked stocks in the broader medical space are Intuitive Surgical (ISRG - Free Report) , DexCom (DXCM - Free Report) and Universal Health Services (UHS - Free Report) .
Intuitive Surgical, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 16.1%. ISRG’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.78%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intuitive Surgical’s shares have risen 31.5% year to date compared with the industry’s 3.5% growth.
DexCom, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 22.9%. DXCM’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 34.1%.
DexCom’s shares have lost 9.2% against the industry’s 3.5% growth year to date.
Universal Health Services has an estimated long-term growth rate of 15.2% for 2024. UHS’ earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 8.12%.
Universal Health Services’ shares have risen 20.7% year to date compared with the industry’s 17.5% growth.
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3 Reasons to Retain Inogen (INGN) Stock in Your Portfolio Now
Inogen, Inc. (INGN - Free Report) is well-poised for growth in the coming quarters, courtesy of high prospects in the portable oxygen concentrator (POC) space. The optimism, led by solid first-quarter 2024 performance and a strong product portfolio, looks promising. However, issues like stiff competition and forex volatility are major downsides.
The Zacks Rank #3 (Hold) company’s shares have risen 21% year to date compared with 20.9% growth of the industry. The S&P 500 has increased 18.3% during the same time frame.
The renowned provider of POCs has a market capitalization of $212.4 million. The company projects 50.2% growth for 2024 and expects to witness continued improvements in its business. Inogen’s P/S ratio of 0.7X compares favorably with the industry’s 3.1X.
Image Source: Zacks Investment Research
Let us delve deeper.
High Prospects in the POC Space: We are optimistic about the POCs’ superiority over conventional oxygen therapy (known as the delivery model). Inogen primarily develops, manufactures and markets innovative POCs to deliver supplemental long-term oxygen therapy (LTOT) to patients suffering from chronic respiratory conditions.
INGN’s proprietary Inogen One and Inogen Rove systems concentrate the air around the patient to offer a source of supplemental oxygen anytime, anywhere, with a battery that can be plugged into an outlet. Per a report by Data Bridge Market Research, the POCs market was estimated to be $1.58 billion in 2022 and is anticipated to reach $3.03 billion by 2030 at a CAGR of 8.5%.
Product Portfolio: We are optimistic about Inogen’s expanding product portfolio. The company has received the FDA’s 510(k) clearance for the Inogen Rove 4, which will be launched in 2024. The FDA clearance of Inogen Rove 6 was received on Jun 30, 2023, and launched in the U.S. market in July 2023. The Inogen Rove 6 is the first POC with an eight-year expected service life. The eight-year expected service life also extends to the Inogen One G5 POCs.
Strong Q1 Results: Inogen’s robust year-over-year uptick in international business-to-business sales in first-quarter 2024 buoys optimism. Solid year-over-year top and bottom-line performances were encouraging. The robust year-over-year uptick in domestic and international business-to-business sales was also impressive. Further, the expansion of the adjusted gross margin bodes well.
On the earnings call, management confirmed its decision to target hospitals in addition to individual practitioners through its rental business. By expanding its scale, efficiency and throughput in the rental channel, Inogen expects to drive higher profitability over time. The company is also seeing cost benefits in the form of lower sales and marketing expenses on the back of the recent exit of its third-party relationship in the rental channel. These look promising for the stock.
Downsides
Stiff Competition: The LTOT market has intense industrial competition. Inogen faces competition from several POC producers and distributors as well as suppliers of other LTOT services, such as home delivery of oxygen cylinders or tanks. Given the relatively straightforward regulatory path in the oxygen therapy device manufacturing market, Inogen expects the industry to become increasingly competitive in the future.
Forex Volatility: The foreign market accounts for a sizeable amount of INGN's income. Management anticipates overseas revenues to continue to be erratic due to the distributor's size and timing. In the near future, INGN also expects unfavorable foreign exchange rates to hinder revenue growth since the U.S. dollar is increasing relative to the euro and other foreign currencies.
Estimate Trend
Inogen has been witnessing an improving estimate revision trend for 2024. In the past 60 days, the Zacks Consensus Estimate for its loss per share has narrowed 9.5% to $2.20.
The Zacks Consensus Estimate for second-quarter 2024 revenues is pegged at $82.3 million, suggesting a 1.6% decline from the year-ago reported number.
Inogen, Inc Price
Inogen, Inc price | Inogen, Inc Quote
Stocks to Consider
Some better-ranked stocks in the broader medical space are Intuitive Surgical (ISRG - Free Report) , DexCom (DXCM - Free Report) and Universal Health Services (UHS - Free Report) .
Intuitive Surgical, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 16.1%. ISRG’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.78%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intuitive Surgical’s shares have risen 31.5% year to date compared with the industry’s 3.5% growth.
DexCom, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 22.9%. DXCM’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 34.1%.
DexCom’s shares have lost 9.2% against the industry’s 3.5% growth year to date.
Universal Health Services has an estimated long-term growth rate of 15.2% for 2024. UHS’ earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 8.12%.
Universal Health Services’ shares have risen 20.7% year to date compared with the industry’s 17.5% growth.