Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Potential Upside |
|---|---|---|---|---|---|---|---|
| 24 May, 24 | PODD | Buy | USD 174.92 | USD 189.5 | USD 201.5 | 38 days | 15.2% |
Data Powered by EOD Historical Data (“EODHD”).
Insulet Corporation develops, manufactures, and sells insulin delivery systems for people with insulin-dependent diabetes. The company's Omnipod platform includes the Omnipod 5 Automated Insulin Delivery System (Omnipod 5) which includes a proprietary AID algorithm embedded in the Pod that integrates with a third-party continuous glucose monitor to obtain glucose values through wireless bluetooth communication; Omnipod DASH that features a bluetooth enabled Pod that is controlled by a smartphone-like Personal Diabetes Manager with a color touch screen user interface; and Omnipod GO, a standalone, wearable, insulin delivery system that provides a fixed rate of continuous rapid-acting insulin for 72 hours. The company sells its products primarily through independent distributors and pharmacy channels, as well as directly in the United States, Canada, Europe, the Middle East, Australia, and internationally. Insulet Corporation was incorporated in 2000 and is headquartered in Acton, Massachusetts.
Increased Profitability: Net Margins of 11.7% in Q1 FY24 vs Industry Median of 2.0%
Rising Revenue Base: Revenue of USD 441.7 mn in Q1 FY24 vs USD 358.1 mn in Q1 FY23
Liquidity Strain: Cash Cycle of 319.0 Days in Q1 FY24 vs Industry Median of 208.2 Days
Leveraged Balance Sheet: Debt-Equity Ratio of 1.77x in Q1 FY24 vs Industry Median of 0.48x
Manufacturing Problem, Reductions in Reimbursement Rates, Adverse Regulatory or Legal Actions, Competitive Pricing, Product Development Risks, Intensified Market Competition, etc.
| Entry Price | Support* | Target 1 | Target 2 |
|---|---|---|---|
| 174.92 | 160.0 | 189.5 | 201.5 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
In the first quarter of 2024, Insulet Corporation demonstrated robust financial performance, with revenues reaching USD 441.7 million, marking a notable increase of 23.3% over the prior year. This revenue growth, surpassing the guidance range of 17% to 20%, was primarily driven by strong performance across all product lines, particularly the Omnipod, which recorded total revenue of USD 433.0 million, representing a 21.1% increase. The U.S. Omnipod revenue surged by 22.7%, reaching USD 317.7 million, while international Omnipod revenue grew by 16.9% to USD 115.3 million. These achievements were complemented by a gross margin of 69.5%, an increase of 230 basis points, and an operating income of USD 56.9 million, reflecting a substantial improvement of 520 basis points over the previous year, and a net income of USD 51.5 million. These figures underscore Insulet's strong financial health and operational efficiency.
In addition to its financial success, Insulet made significant strategic strides in the quarter, including the launch of Omnipod 5 integrated with leading sensor technologies such as Dexcom's G7 and Abbott's Freestyle Libre 2 Plus sensors, both in the U.S. and European markets. The completion of pivotal trials for Omnipod 5, along with the presentation of compelling data at the ATTD International Conference showcasing improved outcomes for type 1 diabetes patients, further solidified Insulet's position as a leader in diabetes management solutions. Looking ahead, the company has revised its revenue growth outlook for 2024 upwards and reaffirmed its commitment to sustaining strong margins, indicative of its optimistic trajectory and strategic focus on delivering value to shareholders while advancing diabetes care globally.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Healthcare Industry: Medical Devices
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| PODD Insulet Corporation |
1.16 0.45% | 257.60 | 53.40 | 61.35 | 7.23 | 16.75 | 7.65 | 40.13 |
| ABT Abbott Laboratories |
1.29 1.15% | 113.22 | 37.15 | 23.15 | 4.67 | 4.97 | 4.88 | 19.38 |
| SYK Stryker Corporation |
-0.41 0.11% | 358.76 | 44.07 | 24.94 | 5.51 | 6.12 | 6.05 | 25.73 |
| MDT Medtronic PLC |
0.41 0.51% | 80.44 | 26.60 | 15.87 | 3.35 | 2.08 | 3.90 | 14.12 |
| BSX Boston Scientific Corp |
1.08 1.23% | 89.11 | 68.17 | 24.57 | 5.85 | 4.26 | 6.46 | 26.80 |
Data Powered by EOD Historical Data (“EODHD”).
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is May 24, 2024. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.
Note 4: ‘Kalkine reports are prepared based on the stock prices captured either from the NASDAQ Stock Exchange (NASDAQ) and or REFINITIV. Typically, both sources (NASDAQ and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’
Note 5: Dividend Yield may vary as per the stock price movement.
Technical Indicators Defined: -
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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