We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why You Should Buy Insulet (PODD) Stock Right Now
Read MoreHide Full Article
Insulet Corporation (PODD - Free Report) is well-poised to gain in the coming quarters, backed by the strength of its revolutionary Omnipod 5 Automated Insulin Delivery (“AID”) system. The continued market expansion of Omnipod DASH is also highly encouraging. Strong solvency is an added upside. Meanwhile, the company’s sole dependency on the Omnipod system and intense competitive pressure remain concerns for its operations.
In the past year, this Zacks Rank #2 (Buy) stock has decreased 47.9% against the 6.6% rise of the industry and 29.3% growth of the S&P 500 composite.
The developer, manufacturer and distributor of insulin delivery systems has a market capitalization of $11.60 billion. Insulet projects a long-term estimated earnings growth rate of 18.1% compared with 11.4% of the industry. PODD’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 100.09%.
Let’s delve deeper.
Upsides
Omnipod DASH’s Market Access Expansion Continues:The company launched the Omnipod DASH system in the United States in 2019. In 2020, PODD made the full commercial rollout of Omnipod DASH in Europe, and Insulet launched the system in Australia and Turkey in late 2021. Further, the Omnipod DASH was launched in the United Arab Emirates and Saudi Arabia markets in 2022. With this launch, the Omnipod is currently available in 24 countries.
Image Source: Zacks Investment Research
Omnipod DASH continues to be the leading insulin pump offer with an indication for use in the Type 2 market. While the company is yet to progress with Omnipod 5 AID in the Type 2 market, the underlying demand for Omnipod DASH in the Type 2 market is encouraging. In the fourth quarter of 2023, Type 2 diabetes patients represented between 20% and 25% of Insulet’s U.S. new customer starts.
Omnipod 5, a New Focus: Insulet believes Omnipod 5 will be a game-changer for people living with diabetes. The company is actively working to expand the reach of Omnipod 5 to preschoolers. Omnipod 5 remains a disruptive force in the diabetes technology market as the only FDA-approved, fully disposable, pod-based AID system.
Further, Omnipod 5 is a key driver of the robust U.S. growth. In the fourth quarter of 2023, U.S. new customer starts coming from multiple daily injections and legacy tubed pumps were an estimated 80-20 percent split, which was in line with the company’s historical mix. Meanwhile, the company commercially launched Omnipod 5 in the United Kingdom and Germany and continues to attract substantial new customer starts across all age groups.
Strong Solvency but Leveraged Balance Sheet: Insulet exited the fourth quarter of 2023 with cash and cash equivalents of $704 million and short-term payable debt of $49 million. This suggests strong solvency. The long-term debt was $1.37 billion in the period, marginally in line with the figure at the end of 2022. The quarter’s total debt-to-capital was 65.9%, a decrease from 74.6% at the end of 2022.
Downsides
Tough Competitive Pressure: Insulet operates in a highly competitive environment dominated by firms ranging from large multinational corporations with significant resources to start-ups. Also, the competitive and regulatory conditions in the markets where the company operates limit Insulet’s ability to switch to strategies like price increases and other drivers of cost increases.
The company’s Omnipod System primarily competes with Medtronic’s market-leading MiniMed, a division of Medtronic. MiniMed boasts a major part of the conventional insulin pump market share in the United States.
Sole Reliance on the Omnipod System: Insulet’s financial results continue to largely depend on the performance of its lead product — the Omnipod System. Per the company, any adverse changes in the market acceptance of the product or worsening of the factors that negatively influence the sale will dent the company’s financials majorly.
Estimate Trend
The Zacks Consensus Estimate for Insulet’s 2024 earnings per share (EPS) has moved up from $2.54 to $3.08 in the past 30 days.
The Zacks Consensus Estimate for the company’s 2024 revenues is pegged at $1.96 billion. This suggests a 15.7% rise from the year-ago reported number.
Cardinal Health has a long-term estimated earnings growth rate of 14.2% compared with the industry’s 11.6%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.6%. Its shares have increased 55.5% compared with the industry’s 15.6% rise in the past year.
Stryker, carrying a Zacks Rank #2 at present, has an earnings yield of 3.37% compared to the industry’s 0.01%. Shares of the company have increased 27.2% compared with the industry’s 6.6% rise over the past year.
SYK’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.09%. In the last reported quarter, it delivered an average earnings surprise of 5.81%.
DaVita, sporting a Zacks Rank #1 at present, has an estimated long-term earnings growth rate of 12.1% compared with the industry’s 11.9%. Shares of DVA have rallied 75.3% compared with the industry’s 23.8% rise over the past year.
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 35.6%. In the last reported quarter, it delivered an average earnings surprise of 22.2%.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Here's Why You Should Buy Insulet (PODD) Stock Right Now
Insulet Corporation (PODD - Free Report) is well-poised to gain in the coming quarters, backed by the strength of its revolutionary Omnipod 5 Automated Insulin Delivery (“AID”) system. The continued market expansion of Omnipod DASH is also highly encouraging. Strong solvency is an added upside. Meanwhile, the company’s sole dependency on the Omnipod system and intense competitive pressure remain concerns for its operations.
In the past year, this Zacks Rank #2 (Buy) stock has decreased 47.9% against the 6.6% rise of the industry and 29.3% growth of the S&P 500 composite.
The developer, manufacturer and distributor of insulin delivery systems has a market capitalization of $11.60 billion. Insulet projects a long-term estimated earnings growth rate of 18.1% compared with 11.4% of the industry. PODD’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 100.09%.
Let’s delve deeper.
Upsides
Omnipod DASH’s Market Access Expansion Continues:The company launched the Omnipod DASH system in the United States in 2019. In 2020, PODD made the full commercial rollout of Omnipod DASH in Europe, and Insulet launched the system in Australia and Turkey in late 2021. Further, the Omnipod DASH was launched in the United Arab Emirates and Saudi Arabia markets in 2022. With this launch, the Omnipod is currently available in 24 countries.
Image Source: Zacks Investment Research
Omnipod DASH continues to be the leading insulin pump offer with an indication for use in the Type 2 market. While the company is yet to progress with Omnipod 5 AID in the Type 2 market, the underlying demand for Omnipod DASH in the Type 2 market is encouraging. In the fourth quarter of 2023, Type 2 diabetes patients represented between 20% and 25% of Insulet’s U.S. new customer starts.
Omnipod 5, a New Focus: Insulet believes Omnipod 5 will be a game-changer for people living with diabetes. The company is actively working to expand the reach of Omnipod 5 to preschoolers. Omnipod 5 remains a disruptive force in the diabetes technology market as the only FDA-approved, fully disposable, pod-based AID system.
Further, Omnipod 5 is a key driver of the robust U.S. growth. In the fourth quarter of 2023, U.S. new customer starts coming from multiple daily injections and legacy tubed pumps were an estimated 80-20 percent split, which was in line with the company’s historical mix. Meanwhile, the company commercially launched Omnipod 5 in the United Kingdom and Germany and continues to attract substantial new customer starts across all age groups.
Strong Solvency but Leveraged Balance Sheet: Insulet exited the fourth quarter of 2023 with cash and cash equivalents of $704 million and short-term payable debt of $49 million. This suggests strong solvency. The long-term debt was $1.37 billion in the period, marginally in line with the figure at the end of 2022. The quarter’s total debt-to-capital was 65.9%, a decrease from 74.6% at the end of 2022.
Downsides
Tough Competitive Pressure: Insulet operates in a highly competitive environment dominated by firms ranging from large multinational corporations with significant resources to start-ups. Also, the competitive and regulatory conditions in the markets where the company operates limit Insulet’s ability to switch to strategies like price increases and other drivers of cost increases.
The company’s Omnipod System primarily competes with Medtronic’s market-leading MiniMed, a division of Medtronic. MiniMed boasts a major part of the conventional insulin pump market share in the United States.
Sole Reliance on the Omnipod System: Insulet’s financial results continue to largely depend on the performance of its lead product — the Omnipod System. Per the company, any adverse changes in the market acceptance of the product or worsening of the factors that negatively influence the sale will dent the company’s financials majorly.
Estimate Trend
The Zacks Consensus Estimate for Insulet’s 2024 earnings per share (EPS) has moved up from $2.54 to $3.08 in the past 30 days.
The Zacks Consensus Estimate for the company’s 2024 revenues is pegged at $1.96 billion. This suggests a 15.7% rise from the year-ago reported number.
Other Key Picks
Some other top-ranked stocks in the broader medical space are Cardinal Health (CAH - Free Report) , Stryker (SYK - Free Report) and DaVita (DVA - Free Report) .
Cardinal Health has a long-term estimated earnings growth rate of 14.2% compared with the industry’s 11.6%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 15.6%. Its shares have increased 55.5% compared with the industry’s 15.6% rise in the past year.
CAH carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Stryker, carrying a Zacks Rank #2 at present, has an earnings yield of 3.37% compared to the industry’s 0.01%. Shares of the company have increased 27.2% compared with the industry’s 6.6% rise over the past year.
SYK’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.09%. In the last reported quarter, it delivered an average earnings surprise of 5.81%.
DaVita, sporting a Zacks Rank #1 at present, has an estimated long-term earnings growth rate of 12.1% compared with the industry’s 11.9%. Shares of DVA have rallied 75.3% compared with the industry’s 23.8% rise over the past year.
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 35.6%. In the last reported quarter, it delivered an average earnings surprise of 22.2%.