Insulet (PODD) Banks on Omnipod for Consistent Market Share Gain
Insulet PODD appears well-poised on solid prospects in the diabetes market. The company continues to gain from strong Omnipod 5 and Omnipod DASH uptake globally. The stock carries a Zacks Rank #1 (Strong Buy).
Insulet is witnessing continued uptake of Omnipod through the U.S. pharmacy channel. Insulet continues to drive increased awareness for Omnipod through its direct-to-consumer advertising campaign in the United States and across select international markets. Omnipod is specifically designed for individuals on multiple daily insulin injections. The company is driving pump penetration across all age groups in both the Type 1 and Type 2 markets, while also gaining in market share.
Omnipod 5 continues to be a driving force behind U.S. and international growth. In the United States, Omnipod 5 represented the vast majority of new customer starts in the third quarter. Customer retention remains strong. In the United States, Omnipod's new customer starts from multiple daily injections and legacy tubed pumps witnessed a 80-20% split in the third quarter, in line with the company’s historical mix.
Further, Insulet’s sales and marketing strategies and international expansion efforts are aligned with its long-term growth profile. The company is focused on advancing its initiatives. Insulet will continue to expand access to Omnipod 5 as well as increase the total addressable market for the Omnipod platform. During the second quarter, Insulet commercially launched Omnipod 5 in the United Kingdom and in August, the device reached Germany commercially.
Insulet Corporation Price
Insulet Corporation price | Insulet Corporation Quote
Earlier in 2023, Insulet received FDA clearance for its basal-only Pod named Omnipod GO, a unique product for the type 2 market. The company is bringing this innovation to market in 2024. According to Insulet, by the end of 2024, it targets Omnipod 5 to be available for the majority of its European customers.
Further, Omnipod DASH continues to be the leading insulin pump for use in the Type 2 market. While the company is yet to progress with Omnipod 5 Automated Insulin Delivery in the Type 2 market, the underlying demand for Omnipod DASH in the said market is encouraging. In third-quarter 2023, Insulet registered quarter-over-quarter growth with Omnipod DASH.
On the flip side, Insulet is incurring higher costs associated with Omnipod 5 production. Added to this, higher production costs due to global inflation as well as supply chain disruptions and labor shortages continue to put pressure on margins. During the third quarter, selling, general & administrative expenses rose 28.7% while research and development expenses rose 28.4% year over year.
Weaker global economic conditions may reduce demand for Insulet’s products, intensify competition, exert pressure on prices, dent supply and lengthen the sales cycle. Moreover, a number of countries in Western Europe are facing liquidity crunch. Insulet is also exposed to the risk of a reduction in healthcare spending in the United States, Canada and Europe due to an economic slump.
Insulet currently expects unfavorable product mix, U.S. manufacturing ramp, inflation and supply chain headwinds to continue to impact business results for the next few years.
Over the past year, PODD shares have declined 46.4% compared with 6.4% decline of the industry.
Other Stock Picks
Some other top-ranked stocks in the broader medical space are HealthEquity HQY, DexCom DXCM, and Haemonetics HAE. While HQY carries a Zacks Rank #1 currently, DXCM and HAE carry a Zacks Rank #2 (Buy) each.
HealthEquity, at present, has an estimated long-term growth rate of 26.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.
HQY’s earnings surpassed estimates in each of the trailing four quarters and missed once, delivering an average surprise of 13.03%. The company’s shares have risen 4.1% year to date against the industry’s 14.7% decline.
DexCom has a long-term expected earnings growth rate of 33.6%. Earnings estimates for 2023 have increased from $1.23 to $1.41 in the past 30 days.
DXCM’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 36.43%. In the last reported quarter, it posted an earnings surprise of 47.1%.
Estimates for Haemonetics’ fiscal 2024 earnings have remained constant at $3.82 in the past 60 days. HAE has a long-term expected earnings growth rate of 10%.
Haemonetics’ earnings beat estimates in each of the trailing four quarters, with the average beat being 19.39%. In the last reported quarter, it delivered an earnings surprise of 38.16%.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Haemonetics Corporation (HAE) : Free Stock Analysis Report
DexCom, Inc. (DXCM) : Free Stock Analysis Report
Insulet Corporation (PODD) : Free Stock Analysis Report
HealthEquity, Inc. (HQY) : Free Stock Analysis Report
