INSPIRE MEDICAL SYSTEMS INC (NYSE:INSP): A Strong Growth Stock with a High Technical Setup Rating

A screening method that uses both fundamental and technical analysis can help investors find companies with good basic business measures while also locating good entry points. The "Strong Growth Stocks with good Technical Setup Ratings" screen is made to do this, selecting for stocks showing solid growth, good financial condition, and acceptable profitability, all while displaying a technical chart pattern that indicates a possible breakout. This two-part method aims to match a company's internal financial soundness with a positive market momentum sign, providing a more complete investment case.

INSPIRE MEDICAL SYSTEMS INC (NYSE:INSP) is a medical technology company that works on creating and selling minimally invasive solutions for patients with obstructive sleep apnea. Its exclusive Inspire therapy is an FDA-approved neurostimulation system that stands as a new option compared to traditional sleep apnea treatments.

Fundamental Growth Profile

The company's fundamental analysis shows a notable growth story, which is the basis of this screening method. A solid growth profile is needed for finding companies with the ability to do better than others in their sector and the wider market.

• High Earnings Growth: The company's Earnings Per Share has grown by a notable 1177.78% over the past year.
• Solid Revenue Increase: Revenue has grown by 22.05% in the last year, with a yearly growth rate of 57.78% over recent years.
• Positive Future Outlook: Analyst estimates point to continued solid growth, with EPS expected to grow by 26.47% and Revenue by 14.74% on average per year.

These measures add to a ChartMill Growth Rating of 7 out of 10, putting it clearly in the "strong growth" group sought by the screen. The company's fundamental analysis report also points out a good financial condition rating of 8, showing no liquidity or solvency issues, which gives a stable base for its growth path.

Valuation and Profitability Context

While growth is a main factor, the screen also looks for acceptable profitability and sensible financial condition to make sure the company is on a stable course.

• Getting Better Profitability: INSP has become profitable, with a Profit Margin of 6.17% that does better than 77% of its industry peers in the Health Care Equipment & Supplies sector.
• Strong Basic Margins: The company keeps a very good Gross Margin of 84.47%, higher than 94% of its competitors.
• Clean Balance Sheet: A major positive is the company's total absence of debt, adding to its high health rating and lowering financial risk.

The valuation, with a P/E ratio of 34.28, may seem high in simple terms but is viewed as fair compared to its industry and future growth possibilities, a usual trait of successful growth stocks where investors are ready to pay more for faster expansion.

Technical Setup and Market Position

The technical analysis is a key part of this method, as it helps find the best time for thinking about a position in a company with sound basics. Even with a difficult period that has led to a low overall technical rating, the present chart shows a significant setup chance.

According to the technical analysis report, INSP has a Setup Rating of 7. The stock has been moving in a range between $70.77 and $83.89 over the last month, with lower volatility. This time of moving in a range after a big downward trend can sometimes come before a possible reversal or breakout. A main support area has been found between $75.17 and $77.33, giving a clear technical level for risk management. With very little close resistance above the present price, a clear move above the recent trading range could be a sign of the start of a new upward trend.

Investment Considerations

INSPIRE MEDICAL SYSTEMS INC presents a situation where solid fundamental growth and a clean balance sheet meet a technical chart that is indicating signs of possible stabilization. The company works in a specialized and increasing medical technology market, dealing with a common health problem with a new solution, which fits with the qualitative conditions important for growth investing, such as aiming at a big addressable market and having a competitive edge. While the stock's longer-term technical trends are still negative, the present high setup rating indicates the conditions for a possible recovery are appearing. Investors should watch the stock's capability to hold the main support level and gain momentum to move out of its recent price range.

For investors wanting to find other companies that match this specific method of joining solid growth basics with positive technical setups, you can view the complete screen results here.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any securities. The content presented is based on data available at the time of writing and may not be current. All investment decisions involve risk, and readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions.