On Thursday, Oppenheimer maintained its Perform rating on Inspire Medical Systems (NYSE:INSP). The firm addressed the growing debate surrounding the efficacy of hypoglossal nerve stimulation (HGNS) therapy used in treating obstructive sleep apnea.
Recent discussions by a competitor of Inspire Medical have suggested that bilateral HGNS (bHGNS) may show "similar" effectiveness in both supine and non-supine sleeping positions. This has sparked questions about the sleep position dependency and the comparative effectiveness of unilateral HGNS (uHGNS).
The firm also referenced a recent paper highlighting the efficacy of uHGNS in the supine position, which prompted further inquiries. Analysts are questioning the methods used to properly titrate HGNS to therapeutic levels. Specifically, they are considering whether titration should be done in supine or non-supine positions and how to differentiate between functional thresholds and discomfort thresholds across various sleeping positions.
Another point of discussion is the accuracy of the Apnea-Hypopnea Index (AHI) as a reliable standard for clinical outcomes in the context of HGNS. The AHI is commonly used to measure the severity of sleep apnea by counting the number of apneas and hypopneas per hour of sleep.
Oppenheimer's note is described as a thought piece that attempts to connect different pieces of evidence to make sense of the current understanding of HGNS. The firm's commentary suggests a landscape of uncertainty and the presence of "unknown unknowns" in the field of HGNS for sleep apnea treatment.
The Perform rating indicates that the analyst believes the stock will perform in line with the broader market and does not suggest a significant change to the stock's outlook based on the current information.
InvestingPro Insights
As Inspire Medical Systems (NYSE:INSP) continues to navigate the competitive landscape of hypoglossal nerve stimulation (HGNS) therapy for obstructive sleep apnea, several financial metrics and analyst insights provide a clearer picture of the company's market position. According to InvestingPro data, Inspire Medical holds a market capitalization of approximately $4.8 billion USD. This valuation comes despite the company not being profitable over the last twelve months, as it posted a negative operating income margin of -5.45% during this period.
The company's revenue growth remains robust, with a 41.71% increase over the last twelve months as of Q1 2024, indicating a strong demand for its HGNS therapy solutions. However, the stock has experienced significant volatility, with a 1-month price total return of -30.97%, reflecting the uncertainties mentioned by Oppenheimer in their analysis.
InvestingPro Tips indicate that Inspire Medical holds more cash than debt on its balance sheet, suggesting financial resilience. Moreover, analysts remain optimistic about the company's future, predicting that Inspire Medical will be profitable this year. For investors seeking more detailed analysis and additional insights, there are 9 more InvestingPro Tips available for Inspire Medical at https://www.investing.com/pro/INSP. These tips could provide valuable guidance in assessing the company's potential amidst the ongoing debates in the HGNS space. Interested readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
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