Insulet Gains 78.5% in a Year: What's Driving the Stock?

Insulet Corporation PODD has witnessed strong momentum in the past year. Shares of the company have risen 78.5% compared with 7.3% growth of the industry during the same time frame. The S&P 500 Composite has increased 9.3%.

With healthy fundamentals and strong growth opportunities, this Zacks Rank #3 (Hold) company appears to be a solid wealth creator for its investors at the moment.

Insulet develops, manufactures and markets the Omnipod System — an innovative, discreet and easy-to-use continuous insulin delivery system for people with insulin-dependent diabetes. The Omnipod System consists of the Omnipod Insulin Management System (Omnipod) and the Omnipod DASH Insulin Management System (Omnipod DASH), a next-generation digital mobile Omnipod platform.

The company reports revenues under three segments — U.S. Omnipod, International Omnipod and Drug Delivery. The Drug Delivery business includes ties with pharmaceutical and biotechnological companies to use a customized form of the Omnipod System to deliver a drug at a certain administered volume and over a specified period of time.

Factors Favoring PODD’s Share Price Growth

Insulet’s share price is trending upward, prompted by the strong performance of the Omnipod 5 system. Omnipod 5 is the only FDA-cleared, fully disposable pod-based AID system. The Type 2 indication has significantly expanded the total addressable market for Insulet by making Omnipod 5 commercially available to more than 5.5 million people in the United States. 

In line with this, Omnipod 5 maintained strong momentum in new customer starts in the United States and grew sequentially as well as year over year in the first quarter of 2025. This optimism, driven by a solid first-quarter performance and increasing revenues from all reportable business segments, is expected to contribute further.

Investors showed optimism about Insulet’s strategic market expansion efforts. During the first quarter of 2025, following the successful launch in five countries — Italy, Denmark, Finland, Norway and Sweden — Insulet launched Omnipod 5 in Australia, Belgium, Canada and Switzerland. 

Insulet expects to bring Omnipod 5 to additional markets in the upcoming quarters of 2025. It will be available in another five markets, including Israel, Saudi Arabia, the United Arab Emirates, Qatar and Kuwait. 

Insulet’s focus on delivering consumer-focused innovation looks encouraging. In lieu of this, the company recently announced a limited market release of Omnipod Discover in the United States. Omnipod Discover is a digital platform that provides personalized data management, insulin usage insights, and learning materials to optimize patient engagement and outcomes. Meanwhile, it has a broad innovation agenda laid out for 2025, poised to reinforce Insulet’s position as a market leader.

Factors That May Offset PODD’s Gains

In the first quarter of 2025, the company’s selling, general & administrative expenses rose 30.5% year over year. This was due to headwinds arising from difficult macroeconomic conditions, continued supply-chain disruptions and labor shortages. Additionally, Insulet expects an impact of approximately 50 basis on gross margin in 2025, based on latest announcements of reciprocal tariff by the U.S. administration. 

Further, Insulet operates in a highly competitive environment. Also, the competitive and regulatory conditions in the markets (where Insulet operates) limit its ability to switch to strategies like price increases. 

A Look at PODD’s Estimates

The Zacks Consensus Estimate for 2025 EPS has moved north 0.7% to $4.31 in the past 30 days.

Insulet has an earnings yield of 1.3% compared with the industry’s 0.6%. 

Stocks to Consider

Some better-ranked stocks in the broader medical space are Phibro Animal Health PAHC, Prestige Consumer Healthcare PBH and Inspire Medical Systems INSP. 

Phibro Animal Health has an estimated long-term earnings growth rate of 26.2% compared with the industry’s 15.9%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 30.6%. Its shares have rallied 26.3% compared with the industry’s 10% growth in the past year.

PAHC carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Prestige Consumer Healthcare, currently carrying a Zacks Rank #2, has an earnings yield of 5.4% compared with the industry’s yield of 0.6%. Shares of the company have rallied 30.3% compared with the industry’s 10% growth. PBH’s earnings surpassed estimates in three of the trailing four quarters and matched on one occasion, the average surprise being 2.8%.

Inspire Medical Systems, carrying a Zacks Rank #2 at present, has an estimated long-term earnings growth rate of 28.9% compared with the industry’s 25.2%. Shares of the company have lost 9.5% against the industry’s 19.6% growth. INSP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 356.9%.

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

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