Here's Why You Should Add Inogen Stock to Your Portfolio Now

Inogen, Inc. INGN is well-poised for growth in the coming quarters, courtesy of high prospects in the portable oxygen concentrator (POC) space. The optimism, led by solid first-quarter 2025 performance and a strong product portfolio, seems justified. However, issues like stiff competition and forex volatility are major downsides.

The Zacks Rank #2 (Buy) company’s shares have lost 28.6% so far this year compared with the industry’s10.2% decline. The S&P 500 has increased 6% during the same timeframe.

The renowned provider of POCs has a market capitalization of $180.4 million. The company projects 37.5% earnings growth for 2025 and anticipates continued improvements in its business going forward. Inogen’s P/S ratio of 0.5X compared with the industry’s 4.1X makes its valuation attractive.

Let us delve deeper.

Huge Prospects in the POC Space: We remain confident in the advantages of POCs over traditional oxygen delivery methods. Inogen specializes in the development, manufacturing and marketing of innovative POCs designed to deliver long-term supplemental oxygen therapy for patients with chronic respiratory conditions.

The company continued to demonstrate strong momentum in the POC market during the first quarter. Per management, the year-over-year uptick in the top line was primarily driven by higher demand and new customer gains across the domestic and international business-to-business channels. This performance reflects growing recognition of Inogen’s solutions, particularly due to their quality, ease of maintenance and extended service life. Per a report by Markets And Markets, the POCs market was valued at $15.05 billion in 2024 and is anticipated to reach $22.63 billion by 2029 at a CAGR of 8.5%.

Product Portfolio: We are encouraged by Inogen’s expanding product portfolio and its potential to drive future growth. Last month, the company launched a new stationary oxygen concentrator, Voxi 5, designed to enhance access to high-quality oxygen therapy for long-term care patients. INGN anticipates that the Rove 4 will make a meaningful contribution to revenue growth in 2025. Additionally, in December 2024, the company received FDA clearance to market Simeoxin the United States, expanding its ability to meet the diverse needs of patients with chronic respiratory conditions.

NGN finalized the strategic collaboration with Jiangsu Yuyue Medical Equipment & Supply Co., Ltd. during the first quarter. The strategic collaboration is expected to broaden Inogen’s product portfolio through the distribution of certain respiratory products in the United States and select other territories, expand and enhance Inogen’s innovation pipeline through R&D collaboration, and accelerate the entry of Inogen’s brand into the Chinese market. This looks promising for the stock.

Further strengthening its global presence, Inogen announced a strategic collaboration with Yuwell in January 2025. Yuwell is a leading global provider of home healthcare medical devices. The partnership is expected to expand Inogen’s product offerings through the U.S. and international distribution of select respiratory devices, support innovation via joint R&D initiatives and facilitate the company’s entry into the Chinese market.

Strong Q1 Results: Inogen delivered solid first-quarter results in February, reflecting a 5.5% year-over-year increase in quarterly revenues. First-quarter domestic and international business-to-business sales were up 29.9% and 22.9%, respectively, on a year-over-year basis. Adjusted gross profit rose 4.9% year over year to $39.4 million, with adjusted gross margin improving 20 basis points to 47.9%.

Risks

Seasonality Impact: The first quarter of 2025 reflected typical seasonal softness, particularly within the direct-to-consumer (DTC) channel. Management anticipates challenges in lead generation and heightened advertising headwinds over the upcoming quarters. Additionally, the DTC segment faced revenue pressure due to a leaner, more streamlined sales team — a factor that’s likely to further impact Inogen’s second-quarter performance.

Forex Volatility: International markets contribute a significant portion to Inogen’s overall revenues. However, management expects overseas sales to remain volatile in the near term, largely due to the varying size and timing of distributor orders. Additionally, unfavorable foreign exchange trends are projected to weigh on revenue growth, as the strengthening U.S. dollar continues to pressure conversions from the euro and other currencies. In the first quarter of 2025, adverse currency movements negatively impacted international sales by 160 basis points.

Inogen, Inc Price

Inogen, Inc price | Inogen, Inc Quote

Estimate Trend

Inogen has been witnessing a positive estimate revision trend for 2025. In the past 30 days, the Zacks Consensus Estimate for its loss per share has narrowed 10.4% to 95 cents.

The Zacks Consensus Estimate for 2025 revenues is pegged at $354 million, suggesting a 5.5% improvement from the year-ago reported number.

Other Stocks to Consider

Some other top-ranked stocks from the same medical industry are GENEDX HOLDINGS WGS, CVS Health CVS and Cencora COR.

GENEDX, carrying a Zacks Rank #2 at present, has an estimated growth rate of 352% for 2025. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

WGS’ earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 145.82%. WGS’ shares have gained 6.3% so far this year.

CVS Health, carrying a Zacks Rank #2 at present, has an estimated growth rate of 12.9% for 2025.

CVS’ earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 18.08%. CVS’ shares have risen 42.4% year to date.

Cencora, carrying a Zacks Rank of 2 at present, has an estimated earnings growth rate of 14.9% for 2025. 

COR’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 6.00%. Its shares have gained 31.1% so far this year.

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This article originally published on Zacks Investment Research (zacks.com).

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