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Here's Why You Should Hold on to Inogen (INGN) Stock Now
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Inogen, Inc. (INGN - Free Report) is well-poised for growth, backed by a robust product portfolio and strength in the direct-to-customer business model. However, rising expenses remain a concern.
Shares of the Zacks Rank #3 (Hold) company have lost 6.6% compared with the industry’s decline of 14.3% on a year-to-date basis. Meanwhile, the S&P 500 Index has fallen 4.5%.
Inogen — with a market capitalization of $722.3 million — develops, manufactures and markets portable oxygen concentrators (POC). POCs are used by patients who suffer from chronic respiratory conditions and need long-term oxygen therapy. The company beat earnings estimates in three of the trailing four quarters and missed once, the average surprise being 151.2%.
Key Catalysts
Inogen’s expanding product portfolio is a key catalyst. The company provides oxygen concentrator solutions for portable and stationary use. Inogen’s flagship product, One G4, is a single-solution POC. Notable products offered by the company include Inogen One G5 in the domestic business-to-business arm and Inogen One G3 POC.
In the fourth quarter of 2021, domestic direct-to-consumer sales increased 23.3% year over year to $33 million for the quarter, primarily driven by higher average selling prices than the comparable prior-year period. Inogen’s direct-to-customer business model has aided it in gaining a leading position in the oxygen therapy market.
Image Source: Zacks Investment Research
The model provides companies an opportunity to build a unique brand relationship directly with customers. The growing direct-to-customer sales and marketing efforts help in increasing awareness among patients. Growth in physician referrals in this segment is expected to boost the top line in the long term.
Factor Hurting the Stock
Inogen witnessed a rise of (14.4%) in adjusted operating costs in the fourth quarter of 2021. Research and development expenses improved 27.5% year over year due to higher personnel-related costs. The company witnessed an increase in sales and marketing expenses led by higher personnel-related costs, consulting expenses and credit card and financing fees. Rising expenses put significant pressure on the company’s margins, thus raising apprehensions.
Per the fourth-quarter 2021 earnings call, the company projects higher material costs between $4.5 million and $5.5 million related to open market purchases of semiconductor chips used in its batteries and POCs in first-quarter 2022. Owing to investment initiatives, the company anticipates higher operating expenses for full-year 2022 compared to 2021.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $371.9 million, suggesting growth of 3.9% from the year-ago reported number. The consensus mark for the bottom line is pegged at a loss of $1.07 per share, wider than the year-ago loss of 28 cents per share.
Stocks to Consider
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20%. The company currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare’s long-term earnings growth rate is estimated at 16.2%. AMN’s earnings yield of 8.8% compares favorably with the industry’s 0.3%.
Henry Schein beat earnings estimates in each of the trailing four quarters, the average surprise being 25.5%. The company currently carries a Zacks Rank #2 (Buy).
Henry Schein’s long-term earnings growth rate is estimated at 11.8%. HSIC’s earnings yield of 5.6% compares favorably with the industry’s 4.1%.
McKesson surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20.6%. The company currently carries a Zacks Rank #2.
McKesson’s long-term earnings growth rate is estimated at 11.8%. MCK’s earnings yield of 8.8% compares favorably with the industry’s 4.1%.
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Here's Why You Should Hold on to Inogen (INGN) Stock Now
Inogen, Inc. (INGN - Free Report) is well-poised for growth, backed by a robust product portfolio and strength in the direct-to-customer business model. However, rising expenses remain a concern.
Shares of the Zacks Rank #3 (Hold) company have lost 6.6% compared with the industry’s decline of 14.3% on a year-to-date basis. Meanwhile, the S&P 500 Index has fallen 4.5%.
Inogen — with a market capitalization of $722.3 million — develops, manufactures and markets portable oxygen concentrators (POC). POCs are used by patients who suffer from chronic respiratory conditions and need long-term oxygen therapy. The company beat earnings estimates in three of the trailing four quarters and missed once, the average surprise being 151.2%.
Key Catalysts
Inogen’s expanding product portfolio is a key catalyst. The company provides oxygen concentrator solutions for portable and stationary use. Inogen’s flagship product, One G4, is a single-solution POC. Notable products offered by the company include Inogen One G5 in the domestic business-to-business arm and Inogen One G3 POC.
In the fourth quarter of 2021, domestic direct-to-consumer sales increased 23.3% year over year to $33 million for the quarter, primarily driven by higher average selling prices than the comparable prior-year period. Inogen’s direct-to-customer business model has aided it in gaining a leading position in the oxygen therapy market.
Image Source: Zacks Investment Research
The model provides companies an opportunity to build a unique brand relationship directly with customers. The growing direct-to-customer sales and marketing efforts help in increasing awareness among patients. Growth in physician referrals in this segment is expected to boost the top line in the long term.
Factor Hurting the Stock
Inogen witnessed a rise of (14.4%) in adjusted operating costs in the fourth quarter of 2021. Research and development expenses improved 27.5% year over year due to higher personnel-related costs. The company witnessed an increase in sales and marketing expenses led by higher personnel-related costs, consulting expenses and credit card and financing fees. Rising expenses put significant pressure on the company’s margins, thus raising apprehensions.
Per the fourth-quarter 2021 earnings call, the company projects higher material costs between $4.5 million and $5.5 million related to open market purchases of semiconductor chips used in its batteries and POCs in first-quarter 2022. Owing to investment initiatives, the company anticipates higher operating expenses for full-year 2022 compared to 2021.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $371.9 million, suggesting growth of 3.9% from the year-ago reported number. The consensus mark for the bottom line is pegged at a loss of $1.07 per share, wider than the year-ago loss of 28 cents per share.
Stocks to Consider
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20%. The company currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare’s long-term earnings growth rate is estimated at 16.2%. AMN’s earnings yield of 8.8% compares favorably with the industry’s 0.3%.
Henry Schein beat earnings estimates in each of the trailing four quarters, the average surprise being 25.5%. The company currently carries a Zacks Rank #2 (Buy).
Henry Schein’s long-term earnings growth rate is estimated at 11.8%. HSIC’s earnings yield of 5.6% compares favorably with the industry’s 4.1%.
McKesson surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20.6%. The company currently carries a Zacks Rank #2.
McKesson’s long-term earnings growth rate is estimated at 11.8%. MCK’s earnings yield of 8.8% compares favorably with the industry’s 4.1%.