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InMode (INMD) to Report Q4 Earnings: What's in the Offing?

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Zacks Equity Research
·4 min read
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InMode Ltd. INMD is set to report fourth-quarter 2020 results on Feb 10, before market open.

In the last reported quarter, the company delivered an earnings surprise of 110%. The company exceeded estimates in three of the trailing four quarters and missed in one, the average surprise being 122.85%.

Let's take a look at how things have shaped up prior to this announcement.

Factors at Play

Through the past few months, InMode has been registering month-wise revenue rebound leveraging on growingdemand for its minimally invasive and hands-free proprietary electrosurgical bipolar RF platforms, which are becoming the standard of care for a variety of surgical procedures. More specifically, during the latter half of the year, with gradual easing out of pandemic restrictions within the United States, the company saw accelerated demand for its differentiated products. Internationally, active marketing and sales activities in China, Brazil, Mexico, and Korea grew as did the company’s subsidiaries in Europe and Asia. All these are expected to get reflected in the company’s fourth-quarter results.

In an update on Nov 12, the company noted that it had recorded sales of disposables in the third quarter, which continued in the fourth quarter as well. Till that time, around 6,400 systems were already installed worldwide and InMode is expected to have seen an increase every month following that on increased demand for disposables. This should have been reflected through the fourth-quarter result.

InMode Ltd. Price and EPS Surprise

InMode Ltd. Price and EPS Surprise
InMode Ltd. Price and EPS Surprise

InMode Ltd. price-eps-surprise | InMode Ltd. Quote

Added to this, amid the pandemic scenario, the company’s clinic-based technologies have been treated as superior alternative to invasive hospital procedures and thereby continued to attract consumer and physician in this environment. This should have contributed to the company’s top line in the to-be-reported quarter.

InMode’s Bipolar RF technology has been performing quite well over the past few quarters, backed by rising customer adoption of the minimally-invasive technology. The company’s newly launched Morpheus8 Platform and Morpheus8 Body that use RF fractional technology are expected to have contributed significantly to the company’s fourth-quarter top line.

Meanwhile, InMode’s Evolve platform, which is the first hands-free platform with three treatment modality, has been well received by customers in the United States. It has been cleared for sale in Canada as well as Europe, thus paving the way for wider customer adoption. Hence, we expect a revenue uptick on the platform’s robust performance.

The company’s other platform, Evoke — a non-invasive solution for facial remodeling — was approved by the FDA and certified by Health Canada in early 2020. Notably, this platform was also approved for marketing and sales in Europe following the receipt of the CE mark. This is expected to result in wider customer adoption, thus boosting revenues.

The Estimate Picture

The Zacks Consensus Estimate for fourth-quarter total revenues and earnings per share is pegged at $62 million and 61 cents, respectively.

What Our Model Suggests

Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has good chances of beating estimates. However, this is not the case here as you can see:

Zacks Rank: The company currently carries a Zacks Rank #3.

Earnings ESP: InMode has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks Worth a Look

Here are a few medical stocks worth considering as these have the right combination of elements to beat on earnings this reporting cycle.

Option Care Health, Inc. OPCH has an Earnings ESP of +34.69% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Radius Health, Inc. RDUS has an Earnings ESP of +10.54% and a Zacks Rank of 2, at present.

DENTSPLY SIRONA Inc. XRAY has an Earnings ESP of +4.45% and is a Zacks #2 Ranked stock.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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DENTSPLY SIRONA Inc. (XRAY) : Free Stock Analysis Report

Radius Health, Inc. (RDUS) : Free Stock Analysis Report

Option Care Health, Inc. (OPCH) : Free Stock Analysis Report

InMode Ltd. (INMD) : Free Stock Analysis Report

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