Inspire Medical Systems Inc. Common Stock (INSP)
StalwartFairStock Score: 77/100 — HIGH CONVICTION
Key Financials
| Current Price | $40.05 |
| Market Cap | $1.6B |
| P/E Ratio | 9.1 |
| ROE | 18.37% |
| Dividend Yield | —% |
| Sector | Healthcare |
Strengths
- Generates $55 million in annual free cash flow (3.4% yield on market cap)
- Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics
- Solid return on equity of 19.8% above cost of capital
- Conservative balance sheet with debt-to-equity of just 0.04, providing financial flexibility
- Altman Z-Score of 8.4 confirms minimal bankruptcy risk and strong solvency
AI Analysis
Inspire Medical Systems Inc. Common Stock is a micro-cap healthcare company valued at $1.6 billion. The business generates $912 million in annual revenue with a 14.9% net margin and $55 million in free cash flow. From a quality standpoint, Inspire shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and Altman Z-Score of 8.4 confirms fortress-level solvency. On valuation, the stock is attractively valued at 11.5x earnings, with trades above its Graham Number with a negative 0% margin. Growth dynamics show revenue growing at 12.3% and profit growth of 286.4%. Our composite FairStock Score of 77/100 reflects strong fundamentals overall. This combination of reasonable valuation, solid returns, and conservative leverage makes it worth a closer look for value-oriented portfolios.
Bull Case
The market underappreciates Inspire's consistent 20% ROE at just 12x earnings—a re-rating toward sector peers could unlock 30-50% upside. With $55 million in annual free cash flow (3.4% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.
Bear Case
Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the healthcare space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.
Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer