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Inogen's (INGN) Q1 Earnings and Revenues Beat Estimates

Zacks Equity Research

Inogen INGN reported first-quarter 2020 loss per share of 7 cents, which was narrower than the Zacks Consensus Estimate of a loss of 10 cents. This compares to earnings of 24 cents in the year-ago quarter.

Revenues came in at $88.5 million, which surpassed the Zacks Consensus Estimate by 6.7%. On a year-over-year basis, the top line dropped 1.9%.

Segmental Details

Revenues at the Sales segment amounted to $83.1 million in the quarter under review, down 2% on a year-over-year basis.

Rental revenues grossed $5.34 million, down 0.7% year over year.

Revenues by Region & Category

Business-to-business revenues in the United States amounted to $27.6 million, up 5.7% on a year-over-year basis. Per management, this increase was primarily driven by increased home medical equipment provider demand. 

Internationally, this segment recorded revenues of $20 million, up 1.4% year over year and 3.6% at constant currency. Per management, the increase was primarily led by higher demand in Canada and Australia.

Direct-to-consumer revenues fell 8.9% year over year to $35.5 million in the quarter.This was due to an approximate 15% reduction in average sales representative headcount compared to the year-ago quarter.

Inogen, Inc Price, Consensus and EPS Surprise

 

Inogen, Inc Price, Consensus and EPS Surprise

 

Inogen, Inc price-consensus-eps-surprise-chart | Inogen, Inc Quote

Margins

In the first quarter, gross profit was $38.4 million, down 13.6% year over year. Gross margin came in at 43.4%, down a significant 588 basis points (bps).

Loss from operations in the quarter was $2.2 million against the year-ago quarter’s operating profit of $4.9 million.

Guidance

Due to uncertainty around impact of the COVID-19 on its business, the company has withdrawn its 2020 guidance, issued on Feb 25.

Wrapping Up

Inogen ended the first quarter on a strong note. The company reported growth in business-to-business international and domestic revenues in the quarter.Inogen expects the business-to-business arm to be a strong contributor to revenues in 2020, thanks to the Tidal Assist Ventilator.

On the flip side, significant contraction in gross margin adds to the woes. Also, decline in direct-to-consumer revenues during the quarter is another concern. The company also saw a decline in Sales and Rental segment revenues.

Zacks Rank and Key Picks

Inogen currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Aphria Inc. APHA, Biogen Inc. BIIB and Eli Lilly and Company LLY. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Aphria reported third-quarter fiscal 2020 adjusted EPS of 2 cents, comparing favorably with the Zacks Consensus Estimate of a loss of 4 cents. Net revenues of $64.4 million outpaced the consensus estimate by 14.6%. The company carries a Zacks Rank #2 (Buy) at present.

Biogen currently carries a Zacks Rank #2. It reported first-quarter 2020 adjusted EPS of $9.14, surpassing the Zacks Consensus Estimate by 18.1%. Revenues of $3.53 billion outpaced the consensus mark by 3.2%.

Eli Lilly delivered first-quarter 2020 EPS of $1.75, outpacing the Zacks Consensus Estimate by 12.9%. Revenues of $145.3 million surpassed the consensus estimate by 6.3%. The company currently sports a Zacks Rank #1.

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