Stifel cuts Inogen to hold; PT to $48 from $85

Stifel downgraded Inogen (NASDAQ:INGN) to “hold” from “buy” and lowered its price target to $48 from $85 after the company’s second quarter sales missed consensus estimates and it reduced 2019 guidance. The stock closed at $42.32 on Aug. 7.

Inogen develops, manufactures and markets portable oxygen concentrators used to deliver supplemental long-term oxygen therapy to patients suffering from chronic respiratory conditions.

Analyst Mathew Blackman cited a more muted near-term sales growth outlook; the absence of tangible evidence of business stabilization; and uncertainty surrounding the company’s long-term sustainable revenue growth and profitability trajectory.

“After the company reset the outlook in the first quarter, we thought Inogen had set a reasonable second quarter bar,” he said. “But, following [the] second quarter results, it is clear that the business has weakened, existing headwinds have persisted and new headwinds have emerged.”

Mr. Blackman said he meaningfully lowered his 2019 and beyond sales, EBIT, and EPS projections. “For context, our new 2020 sales projection at $406-million … compares to our original 2020 estimate, following the fourth quarter of 2018, at $520-million,” he added.


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