Inari Medical, Inc. ( NARI Quick Quote NARI - Free Report) is well-poised for growth, backed by a huge market opportunity for products and its commitment to understand the venous system. However, its dependency on the adoption of products is concerning.
Shares of this Zacks Rank #3 (Hold) company have lost 0.2% against the
industry’s 1% growth so far this year. The S&P 500 Index is up 7.9% in the same time frame.
NARI, with a market capitalization of $3.29 billion, is a commercial-stage medical device company that seeks to develop products for treating and changing the lives of patients suffering from venous diseases. The company’s earnings yield of (0.8%) compares favorably with the industry’s (7.3%). Its earnings beat estimates in each of the trailing four quarters, the average surprise being 24.63%.
Image Source: Zacks Investment Research What’s Driving NARI’s Performance?
Inari Medical is spearheading the creation and commercialization of devices that are purposefully built, keeping in mind the specific characteristics of the venous system, its diseases and unique clot morphology. The company’s in-depth knowledge of its target market and commitment to understand the venous system have allowed it to figure out the unmet needs of patients, as well as physicians. This, in turn, has enabled NARI to quickly innovate and improve its products, while updating its clinical and educational programs.
In January, the company enrolled the first patient in its prospective randomized controlled trial — DEFIANCE — for comparing the clinical outcomes of ClotTriever System to anticoagulation, only in patients with iliofemoral deep vein thrombosis (DVT). A successful completion will support the favorable profile of Inari Medical’s key product, ClotTriever, in treating DVT patients.
In October 2022, NARI announced positive in-hospital and 30-day outcome data from the fully-enrolled CLOUT deep vein thrombosis registry. The company also reported positive results from a propensity-matched comparison of patients treated in the CLOUT registry to those treated with pharmacomechanical thrombolysis in an NIH-sponsored randomized controlled trial, ATTRACT. The analysis showed that patients had complete thrombus clearance following treatment with the ClotTriever system at nearly twice the rate of patients in the intervention arm of ATTRACT. ClotTriever also resulted in significantly fewer patients with post-thrombotic syndrome (PTS), with an absolute reduction of 13% at 30 days. The trial data demonstrated that ClotTriever removed more clots than other interventional options, and resulted in better patient outcomes and lower PTS rates. These outcomes will likely result in higher adoption of the treatment among physicians and patients.
Last year, the company announced favorable outcomes of the fully enrolled 800-patient
FLASH registry in pulmonary embolism (PE). The primary endpoint of the registry was successfully met by FlowTriever for the treatment of PE. The company is also conducting a PEERLESS randomized controlled trial in PE patients.
Inari Medical stated that a significant percentage of DVT and PE patients are treated with conservative medical management that involves anticoagulants alone, which do not break down or remove an existing clot. The company believes that there is a huge untapped demand for safe and effective treatment and removal of existing clots in patients with these diseases.
NARI reported total revenues of $107.8 million for the quarter, indicating a 30% year-over-year rise. For 2022, the company’s revenues were $383.5 million. It expanded its territories to more than 275 in 2022. Inari Medical expects total revenues between $470 million and $480 million for 2023, indicating growth of 23-25% from the previous year's reported figure.
What’s Weighing on the Company?
Most of NARI’s product sales and revenues come from a limited number of hospitals. The company’s growth and profitability mainly depend on its ability to boost physician and patient awareness of its products. These also depend on how keen physicians and hospitals are to adopt its products and perform catheter-based thrombectomy procedures on patients suffering from venous thromboembolism.
The company’s inability to validate the benefits of its products and catheter-based thrombectomy procedures will result in limited adoption of the same. Moreover, it may not happen as quickly as expected. These factors, in unison, may negatively impact NARI’s business and financial condition.
For 2023, the Zacks Consensus Estimate for revenues is pegged at $476.1 million, indicating an improvement of 24.2% from the previous year's reported figure. Loss per share estimates for the company is 51 cents, indicating a 7.3% improvement from that reported in 2022.
Stocks to Consider
Some better-ranked stocks in the broader medical space are
Becton, Dickinson and Company ( BDX Quick Quote BDX - Free Report) , Henry Schein ( HSIC Quick Quote HSIC - Free Report) and The Cooper Companies ( COO Quick Quote COO - Free Report) .
Becton, Dickinson and Company, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth of 7.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.47%. You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .
So far this year, BDX’s shares have declined 2.4% against the industry’s 5.6% growth.
Henry Schein, sporting a Zacks Rank #1 at present, has an estimated long-term growth of 18.3%. Its earnings surpassed estimates in three of the trailing four quarters and met the same once, the average surprise being 2.97%.
So far this year, the company’s shares have gained 3.3% compared with the industry’s 5.6% growth.
The Cooper Companies, carrying a Zacks Rank #2 at present, has an estimated long-term growth of 11%. COO’s earnings missed estimates in each of the trailing four quarters, the average negative surprise being 1.82%.
So far this year, the company’s shares have gained 11.9% compared with the industry’s 5.6% growth.