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In December 2018, Inogen, Inc. (NASDAQ:INGN) released its earnings update. Generally, it seems that analyst expectations are fairly bearish, as a -15% rise in profits is expected in the upcoming year, against the higher past 5-year average growth rate of 47%. By 2020, we can expect Inogen’s bottom line to reach US$44m, a jump from the current trailing-twelve-month of US$52m. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for Inogen in the longer term. For those interested in more of an analysis of the company, you can research its fundamentals here.
What can we expect from Inogen in the longer term?
Longer term expectations from the 7 analysts covering INGN’s stock is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
From the current net income level of US$52m and the final forecast of US$69m by 2022, the annual rate of growth for INGN’s earnings is 11%. This leads to an EPS of $2.91 in the final year of projections relative to the current EPS of $2.44. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 14% to 12% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Inogen, I've compiled three important factors you should look at:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation: What is Inogen worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Inogen is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Inogen? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.