Analyst Richard Newitter from Truist Financial maintained a Hold rating on Inspire Medical Systems and increased the price target to $128.00 from $84.00.
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Richard Newitter has given his Hold rating due to a combination of factors influencing Inspire Medical Systems. The recent unexpected increase in reimbursement rates for Inspire’s procedures by CMS has been a positive development, leading to an increase in the price target. This change has improved the outlook for revenue growth and profitability, providing a more favorable economic incentive for providers. However, despite these positive developments, there are still challenges that Inspire faces, such as capacity utilization bottlenecks and competition from emerging players.
While the reimbursement increase is a significant tailwind, Richard Newitter remains cautious due to uncertainties in the market, including potential changes in reimbursement codes and macroeconomic factors that could impact demand. Additionally, the stock’s recent price movement reflects a valuation reset, but there is a need for further analysis to determine the long-term impact of these changes on volume growth and profitability. As a result, the Hold rating reflects a balanced view of the potential for growth against the backdrop of these uncertainties.