Insulet Corporation PODD has witnessed strong momentum in the past year. Shares of the company have risen 62.9% compared with 9.9% growth of the industry during the same time frame. The S&P 500 Composite has increased 9.1%.
With healthy fundamentals and strong growth opportunities, this Zacks Rank #2 (Buy) company appears to be a solid wealth creator for its investors at the moment.
Insulet develops, manufactures and markets the Omnipod System — an innovative, discreet and easy-to-use continuous insulin delivery system for people with insulin-dependent diabetes. The Omnipod System consists of the Omnipod Insulin Management System (Omnipod) and the Omnipod DASH Insulin Management System (Omnipod DASH), a next-generation digital mobile Omnipod platform.
The company reports revenues under three segments — U.S. Omnipod, International Omnipod and Drug Delivery. The Drug Delivery business includes ties with pharmaceutical and biotechnological companies to use a customized form of the Omnipod System to deliver a drug at a certain administered volume and over a specified period of time.
Factors Favoring PODD’s Share Price Growth
Insulet’s share price is trending upward, prompted by the strong performance of the Omnipod 5 system. Omnipod 5 is the only FDA-cleared, fully disposable pod-based AID system. The Type 2 indication has significantly expanded the total addressable market for Insulet by making the Omnipod 5 commercially available to more than 5.5 million people in the United States.
In line with this, Omnipod 5 maintained strong momentum in new customer starts in the United States and grew sequentially as well as year over year in the fourth quarter of 2024. This optimism, driven by a solid fourth-quarter performance and increasing revenues from all reportable business segments, is expected to contribute further.
Investors showed optimism about Insulet’s strategic market expansion efforts. Following the successful launch in France and the Netherlands last year, Insulet introduced Omnipod 5 in five additional countries — Italy, Denmark, Finland, Norway and Sweden — in January 2025. In March 2025, the company made Omnipod 5 available in Australia.
Insulet expects to bring Omnipod 5 to additional markets in the upcoming quarters of 2025, starting with a launch in Belgium and Switzerland with Abbott’s FreeStyle Libre 2 Plus and Dexcom G6 and G7 sensor integrations. Next, it will be launched in Canada with Dexcom G6 and G7 sensor compatibility. It will be available in another five markets, including Israel, Saudi Arabia, the United Arab Emirates, Qatar and Kuwait.
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Insulet’s focus on delivering consumer-focused innovation looks encouraging. In lieu of this, the company recently announced a limited market release of Omnipod Discover in the United States. Omnipod Discover is a digital platform that provides personalized data management, insulin usage insights, and learning materials to optimize patient engagement and outcomes. Meanwhile, it has a broad innovation agenda laid out for 2025, poised to reinforce Insulet’s position as a market leader.
Factors That May Offset PODD’s Gains
In the fourth quarter of 2024, the company’s selling, general & administrative expenses rose 22.6% year over year, resulting in an operating margin contraction of 258 basis points year over year. This was due to headwinds arising from difficult macroeconomic conditions, continued supply-chain disruptions and labor shortages.
Further, Insulet operates in a highly competitive environment. Also, the competitive and regulatory conditions in the markets, where Insulet operates, limit its ability to switch to strategies like price increases and other drivers of cost increases.
A Look at PODD’s Estimates
The Zacks Consensus Estimate for 2025 EPS has moved north 9.4% to $4.29 in the past 30 days.
Insulet has an earnings yield of 1.6% compared with the industry’s 0.3%.
Other Stocks to Consider
Some other top-ranked stocks in the broader medical space are Phibro Animal Health PAHC, Masimo MASI and Cardinal Health CAH.
Phibro Animal Health has an earnings yield of 8.2%, well ahead of the industry’s 1.2%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 27.06%. Its shares have surged 45.3% against the industry’s 2.2% decline in the past year.
PAHC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Masimo, presently carrying a Zacks Rank #1, has an earnings yield of 2.5%, well ahead of the industry’s -3.6%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 14.4%. Its shares have surged 45.3% against the industry’s 2.2% decline in the past year.
Cardinal Health, carrying a Zacks Rank #2 at present, has an estimated long-term earnings growth rate of 10.7% compared with the industry’s 9.4%. Shares of the company have rallied 12.1% against the industry’s 2.3% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
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