InMode (NASDAQ:INMD), the Israel-based medical tech firm, has revised its revenue forecast for 2023 due to an economic slowdown and a return to typical Q3 seasonality. The company's new revenue guidance stands between $500 million and $510 million, marking a significant decrease from the initial projection of $530 million to $540 million, according to a report by Dean Seal on Thursday.
The company's Q3 sales are anticipated to be around $122.8 million, notably lower than the previously estimated $136.9 million. The announcement of these figures is expected on Nov. 2. In addition, InMode's adjusted earnings per share are estimated at 59-60 cents, falling short of prediction of 66 cents.
The downward adjustment in guidance is primarily attributed to a summer slowdown in aesthetic activity that led to postponed purchase decisions. Further challenges faced by the company include complications in medical equipment financing, which were marked by high interest rates, strict leasing standards, and processing delays.
According to InvestingPro Data, InMode's market cap stands at $1.85 billion, with a P/E ratio of 10.07. Despite the current challenges, the company has been profitable over the last 12 months, as per InvestingPro Tips, with a return on assets of 29.07% as of LTM2023.Q2. However, it's worth noting that the company's stock has been quite volatile, with a three-month price total return of -38.1% as of Y2023.D285.
InMode also holds more cash than debt on its balance sheet, which could provide it with the financial flexibility to navigate the current challenges. Moreover, the company's revenue growth has been slowing down recently, with a quarterly growth of 19.85% in FY2023.Q2, which could be a cause for concern for investors.
Looking ahead, analysts predict the company will be profitable this year, despite the revised revenue guidance. The company's fair value, according to InvestingPro, is estimated at $42.95, offering potential upside from its previous close price of $27.99.
For more insights, investors can turn to InvestingPro, which offers a range of tips and real-time metrics for companies like InMode. There are 17 additional tips listed in InvestingPro for INMD, which can be accessed here.
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