Yahoo Finance Inari Medical (NARI) Q1 Earnings Miss Estimates, OpEx Rises
Inari Medical, Inc. NARI reported an adjusted loss per share of 26 cents in the first quarter of 2024 compared with the year-ago period’s loss of 4 cents per share. The Zacks Consensus Estimate for loss per share was pegged at 11 cents. On a GAAP basis, the company recorded a loss per share of 42 cents. There was no adjustment in the prior-year period.
Revenues in Detail
Inari Medical registered revenues of $143.2 million in the first quarter, up 23.3% year over year. The figure beat the Zacks Consensus Estimate by 3.5%.
Shares of Inari Medical were up 12.5% in pre-market trading on May 1 following better-than-expected quarterly results. The stock has lost 37.8% in the past year against the industry’s 2.9% growth. The broader S&P 500 Index has moved up 23.2% in the past year.
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Q1 Highlights
During the reported quarter, NARI witnessed growth in revenues for its global VTE business on the back of commercial expansion and market development. Emerging therapies business saw robust growth with RevCore performing well. Management also informed about executing the limited market release of Venacore, the second purpose-built tool within the CBD toolkit. Also, Inari Medical made great progress in integrating the LimFlow business.
Inari Medical expects to showcase its PEERLESS data, which is one of the three randomized controlled trials (RCTs), in the second half of 2024. PEERLESS study is likely to evaluate patient outcomes using the FlowTriever device. The company is progressing well with the other two RCTs as well.
According to management, Inari Medical saw record cases and revenue generation outside of the United States for the first quarter. Increased adoption of Inari Medical’s products in Western Europe was the main factor driving its performance and excellent case growth in its early-stage markets in Latin America, Canada, and the Asia-Pacific region. The company is expecting to start treating patients in China and Japan in 2024, and it is currently making good progress in both regions. Management expects its international business to represent more than 20% of total revenues in the future on the back of unmet needs.
Margin Trend
In the quarter under review, Inari Medical’s gross profit improved 21.5% to $124.3 million. The gross margin contracted 140 basis points (bps) to 86.8%.
Selling, general and administrative expenses rose 20.3% to $103.1 million. Research and development expenses increased 21.8% year over year to $26.9 million. The operating expenses of $141.5 million increased 31.3% year over year.
The operating loss totaled $17.2 million compared with $5.3 million in the year-ago period. Excluding acquisition-related costs of $2.8 million, acquired intangible asset amortization of $2.5 million and change in fair value of contingent consideration liability of $6.3 million, adjusted operating loss in the first quarter was $5.6 million.
Financial Position
Inari Medical exited first-quarter 2024 with cash and cash equivalents and short-term investments of $101.8 million compared with $116.1 million at the fourth quarter of 2023-end.
Cumulative net cash used in operating activities at the end of first-quarter 2024 was $12.3 million compared to cumulative net cash used in operating activities of approximately $2 million in the year-ago quarter.
Guidance
Inari Medical has updated its financial outlook for 2024.
For 2024, the company now expects revenues in the range of $592.5 million-$602.5 million (reflecting growth of 20%-22% from 2023) compared with the previous guidance of $580 million-$595 million. The Zacks Consensus Estimate is pegged at $587.2 million.
Our Take
Inari Medical exited the first quarter of 2024 with an improvement in overall revenues. However, earnings missed the Zacks Consensus Estimate. The company continued to make impressive progress in its product portfolio, which resulted in robust product adoption by its customers. Geographical performances were also impressive.
However, Inari Medical’s lower gross margin and dismal bottom-line performances were disappointing. The company incurred an operating loss during the quarter, which raised our apprehension.
Inari Medical, Inc. Price, Consensus and EPS Surprise
Inari Medical, Inc. price-consensus-eps-surprise-chart | Inari Medical, Inc. Quote
Zacks Rank and Key Picks
Inari Medical currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. ALGN, Ecolab ECL and Boston Scientific Corporation BSX.
Align Technology, carrying a Zacks Rank of 2 (Buy), reported first-quarter 2024 adjusted earnings per share (EPS) of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Align Technology has a long-term estimated growth rate of 6.9%. ALGN’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 13.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 1.7%.
Ecolab’s shares have rallied 33.8% against the industry’s 9.3% decline in the past year.
Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.
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Inari Medical, Inc. (NARI) : Free Stock Analysis Report
