On Wednesday, Piper Sandler adjusted its outlook on Inari Medical Inc. (NASDAQ:NARI), reducing the price target to $50 from the previous $55, while keeping a neutral stance on the stock. The adjustment follows Inari Medical's first-quarter earnings report.
Inari Medical's reported Q1 revenue reached $143.2 million, surpassing both the Street's projection of $137.8 million and Piper Sandler's estimate of $137.6 million. Despite this revenue outperformance, the company's GAAP EPS was affected by several deal-related expenses, making it not directly comparable to the consensus estimate of a $0.16 loss per share.
The revenue beat was attributed to multiple factors, with the U.S. core venous thromboembolism (VTE) treatments being the primary contributor, which is seen as a positive indicator. The growth of Inari Medical's U.S. VTE franchise was estimated at 16.3% year-over-year for the first quarter, outpacing the anticipated 12.0% increase.
Furthermore, Inari Medical raised its full-year revenue guidance by $10 million, now expecting between $592.5 million and $602.5 million, which would represent a 20-22% year-over-year increase.
Despite the strong quarterly performance, Piper Sandler awaits further clarity on the U.S. core VTE franchise before adopting a more positive stance on Inari Medical's stock.
The reduced price target reflects Piper Sandler's cautious optimism, acknowledging the company's solid quarterly results but also considering the need for additional visibility into key business segments before changing its rating.
InvestingPro Insights
In light of Piper Sandler's recent adjustment of Inari Medical's price target, InvestingPro provides additional context to investors, highlighting some key metrics and insights. With a market capitalization of $2.16 billion, Inari Medical is trading near its 52-week low, which may interest value-seeking investors. The company's impressive gross profit margin stands at 87.67% for the last twelve months as of Q1 2024, underscoring its ability to maintain profitability at the operational level despite not paying dividends and analysts' expectations of a drop in net income this year.
One of the InvestingPro Tips suggests that Inari Medical's liquid assets exceed its short-term obligations, indicating a solid liquidity position that could support ongoing operations and strategic initiatives. However, the company operates with a moderate level of debt and has been unprofitable over the last twelve months. The stock's performance has been under pressure, with a 1-month price total return showing a decline of 20.86% as of the latest data point. These financial health indicators and market performance metrics can be crucial for investors looking to make informed decisions.
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