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Why Is Inari Medical, Inc. (NARI) Up 8.8% Since Last Earnings Report?

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It has been about a month since the last earnings report for Inari Medical, Inc. (NARI - Free Report) . Shares have added about 8.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Inari Medical, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Inari Medical Q2 Earnings Lag, Revenues Top Estimates

Inari Medical, Inc. reported second-quarter 2021 adjusted earnings per share of 7 cents, which missed the Zacks Consensus Estimate of 9 cents by 22.2%. The company reported a loss of 16 cents per share in the year-ago period.

GAAP earnings per share was 8 cents per share, against the year-ago quarter’s loss of 16 cents.

Revenue Details

The company reported revenues of $63.5 million, which skyrocketed 149.9% from the prior-year quarter. The top line outpaced the Zacks Consensus Estimate by 5.5%.

Q2 Highlights

The company treated a record number of patients, which boosted revenues in the quarter under review, thereby significantly expanding its commercial footprint.

Inari Medical announced the FDA clearance of FlowSaver, which will aid in bloodless thrombectomy through utilizing Triever Catheters.

The company put forth interim results of the CLOUT DVT registry at New Cardiovascular Horizons, which confirmed best in class safety, clot removal and clinical results with respect to patients treated with ClotTriever.

Margins

Gross profit in the reported quarter was $58.6 million, up 167.7% year over year. As a percentage of revenues, gross margin in the quarter was 92.4%, up 610 basis points (bps).

Research and development expenses were $11.6 million, up 220.6% from the year-ago quarter, while selling, general and administrative expenses amounted to $42.9 million, up 127.2% on a year-over-year basis.

Operating income totaled $4.1 million against the year-ago quarter’s loss of $0.6 million.

Financial Position

The company exited the second quarter with cash, cash equivalents and short-term investments of $91.3 million, down from $174.1 million on a sequential basis.

Cumulative net cash provided by operating activities at the end of the second quarter was $16.1 million, against net cash used in operating activities worth $1.8 million in the prior-year quarter.

2021 Revenue Outlook Raised

In spite of the continued uncertainties and challenges in its operating environment stemming from the COVID-19 pandemic, the company has updated its financial outlook.

For 2021, revenues is currently projected to be $250-$255 million (up from the prior range of $240-$250 million). The Zacks Consensus Estimate for the same is pegged at $248.6 million.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -40.35% due to these changes.

VGM Scores

Currently, Inari Medical, Inc. has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Inari Medical, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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