Reasons to Retain Inari Medical Stock in Your Portfolio for Now

Inari Medical, Inc. NARI is well poised for growth on the back of a huge market opportunity for its products and its commitment to understanding the venous system. However, the company’s dependency on the adoption of its products is concerning.Shares of this Zacks Rank #3 (Hold) company have lost 20.6% year to date against the industry’s 6.4% growth. The S&P 500 Index has risen 27.1% in the same time frame.NARI, with a market capitalization of $3.05 billion, is a commercial-stage medical device company. It seeks to develop products for treating and changing the lives of patients suffering from venous diseases.Image Source: Zacks Investment ResearchThe company’s negative earnings yield of 1.7% compares favorably with the industry’s (-5.6%). It delivered a trailing four-quarter average earnings surprise of 24.77%.What’s Driving NARI’s Performance?Inari Medical’s top-line growth is primarily driven by its ClotTriever and FlowTriever products that target patients with venous thromboembolism (VTE) (with significant growth opportunities going forward). The significant growth prospects for Inari’s VTE products should help drive the company’s revenues. Currently, conservative medical management with anticoagulants is the standard of care for VTE.However, new therapies like ClotTriever and FlowTriever products are demonstrating rising adoption as they lead to lower treatment-related risks. Inari focuses on establishing its treatments as the standard of care for VTE, whichis significantly underpenetrated.According to Inari Medical’s estimate, there are 1.9 million people with VTE in the United States each year, with 1 million diagnosed with DVT and 900,000 with PE. Among this patient population, around 430,000 DVT and 280,000 PE patients every year in the United States could benefit from treatment through ClotTriever and FlowTriever products, respectively.During the reported quarter, NARI witnessed growth in revenues from its global VTE business on the back of commercial expansion and market development. The global VTE revenues totaled $145.3 million, up 19.7% year over year. The company expects robust growth to continue for this business on the back of the strong adoption of mechanical thrombectomy in the upcoming years as NARI leads in the significantly underpenetrated VTE market in the United States. The company continues to evaluate patient outcomes using its VTE products like FlowTriever and ClotTriever to establish them as the standard of care.NARI’s commercial expansion and market development plans have been driving the global VTE business, its major revenue generator. Moreover, rising demand for emerging therapies like RevCore should bring in additional revenues in the upcoming quarters, thereby boosting top-line growth. The company is currently engaged in the limited market release of Venacore, the second purpose-built tool within the CBD toolkit, expanding NARI’s emerging therapies category.Emerging therapies saw robust growth as well. The company is currently progressing well with the limited market release of the LimFlow system in the United States. Beginning October 2024, the LimFlow procedures are now reimbursed through NTAP, which should allow higher reimbursements. This is expected to lead to increased adoption when NARI starts the full commercial release of the system in 2025.NARI expects to start treating patients in China and Japan soon and is currently finalizing its go-to-market strategy for both regions. The company gained regulatory approval in Japan for ClotTriever during the third quarter, with a reimbursement approval likely in the fourth quarter. Due to unmet needs, management expects its international business to represent more than 20% of total revenues in the future.What’s Weighing on the Stock?Although ClotTriever and FlowTriever have attractive reimbursement coverages, these are determined by government agencies, private insurers and other payors for a particular procedure, irrespective of the devices used. Meanwhile, third-party payors are increasingly limiting coverage and reducing reimbursements for medical products and services.In addition, the U.S. government, state legislatures and foreign governments have continued implementing cost-containment programs, including price controls, restrictions on coverage and reimbursements. Any unfavorable change in coverage for Inari Medical’s products will likely hurt their adoption, affecting top-line growth. Moreover, expansion in international markets is a greater risk as several countries are unlikely to have extensive reimbursement coverage, which may adversely impact adoption.Inari Medical is currently facing a civil investigative demand from the U.S. Department of Justice, Civil Division, in connection with an investigation under the federal Anti-Kickback Statute and Civil False Claims Act. According to the department, NARI might have been involved in influencing healthcare professionals to prescribe its products. Any unfavorable ruling should be a setback for the company that may lead to lower demand for its products, hurting sales growth.Inari Medical, Inc. Price Inari Medical, Inc. price | Inari Medical, Inc. QuoteEstimate TrendThe Zacks Consensus Estimate for the company’s 2024 revenues is pegged at $603 million, indicating a 22.2% increase from the previous year’s reported number. The consensus estimate for the bottom line is pinned at a loss of 88 cents, implying a 777% decline from that recorded a year ago. However, earnings are expected to improve 94% in 2025.Key PicksSome better-ranked stocks in the broader medical space are Masimo MASI, Accuray ARAY and AxoGen AXGN.Masimo, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated growth rate of 11.8% for 2025. You can see the complete list of today’s Zacks #1 Rank stocks here.MASI’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 17.10%. Its shares have risen 48.6% compared with the industry’s 6.4% growth year to date.Accuray, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 1200% for 2025. Its earnings missed estimates in three of the trailing four quarters and met in one, delivering an average negative surprise of 141.97%.ARAY’s shares have lost 25.8% against the industry’s 6.4% growth year to date.AxoGen, carrying a Zacks Rank of 2 at present, has an estimated earnings growth rate of 252% for 2025. Its delivered a trailing four-quarter average earnings surprise of 91.11%.AXGN’s shares have risen 111.4% year to date compared with the industry’s 6.4% growth.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 Accuray Incorporated (ARAY): Free Stock Analysis Report Masimo Corporation (MASI): Free Stock Analysis Report AxoGen, Inc. (AXGN): Free Stock Analysis Report Inari Medical, Inc. (NARI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks