Last Updated: 18 Sep 2024
Executive Summary
InMode Ltd (INMD) is a leading provider of minimally invasive aesthetic medical products. The company's products are based on its proprietary RF-assisted lipolysis and deep subdermal fractional RF technologies. InMode has a strong financial position with high profitability and a growing market share. The company's shares are currently trading at a discount to its intrinsic value, making it an attractive investment opportunity.
Company Overview
InMode was founded in 2000 and is headquartered in Yokneam, Israel. The company designs, develops, manufactures, and markets a range of aesthetic medical products, including devices for body contouring, skin tightening, and hair removal. InMode's products are used by dermatologists, plastic surgeons, and other aesthetic practitioners.
The company's proprietary RF-assisted lipolysis technology uses radiofrequency energy to heat and liquefy fat cells, which are then removed through a small incision. This technology is less invasive than traditional liposuction and offers a shorter recovery time. InMode's deep subdermal fractional RF technology uses radiofrequency energy to create micro-injuries in the skin, which stimulates collagen production and results in skin tightening and rejuvenation.
Fundamental Analysis
InMode has a strong financial position with high profitability and a growing market share. The company's revenue has grown at a CAGR of 20% over the past five years. In 2023, the company reported revenue of $416.6 million, up 10% year-over-year. InMode's gross profit margin is 89%, and its operating margin is 21%. The company's net income margin is 15%.
InMode has a strong balance sheet with $134.7 million in cash and equivalents and no debt. The company's current ratio is 2.5, and its quick ratio is 1.5.
InMode's shares are currently trading at a P/E ratio of 10.04, which is below the industry average of 12.5. The company's PEG ratio is 2.9, which indicates that its growth potential is undervalued by the market.
Technical Analysis
InMode's stock price has been in a downtrend since reaching a high of $33.62 in August 2022. The stock is currently trading at $17.46, which is below its 50-day and 200-day moving averages. The stock's relative strength index (RSI) is 35, which indicates that it is oversold.
Short Term Outlook
In the short term, InMode's stock price is likely to continue to trade in a range between $15 and $20. The stock's technical indicators are bearish, and the market is currently in a risk-off mode. However, InMode's strong fundamentals should provide support for the stock price.
Long Term Outlook
In the long term, InMode's stock price is expected to rise as the company continues to grow its market share. The company's products are in high demand, and the market for aesthetic medical procedures is growing. InMode is well-positioned to capitalize on this growth and continue to deliver strong financial results.
Analyst Recommendations
The majority of analysts have a buy rating on InMode's stock. The average analyst target price is $21, which represents a potential upside of 20% from the current price.
