Inspire Medical Systems (INSP): Assessing Valuation After Major Medicare Reimbursement Boost

Inspire Medical Systems (INSP) shares have rallied after the Centers for Medicare & Medicaid Services finalized a sweeping reimbursement hike for the company's sleep apnea implant procedures. The increase will take effect in 2026. The payment boost is expected to have a lasting impact on Inspire's revenue prospects and margins.

See our latest analysis for Inspire Medical Systems.

Momentum has rapidly shifted for Inspire Medical Systems, with last week’s 53% share price return following the Medicare reimbursement news and more than reversing earlier negativity. Even after this surge, the 1-year total shareholder return remains deeply negative, reflecting a tough year. However, the sharp recent rally suggests investors see renewed growth potential and are recalibrating risk after months of disappointment and lawsuits.

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With shares rocketing higher and analyst upgrades piling up, the key question is whether Inspire Medical Systems is now trading at a bargain or if the market has already fully priced in the company’s brighter growth outlook.

Most Popular Narrative: 8% Overvalued

The most widely followed narrative now pegs Inspire Medical Systems’ fair value well below the recent close. This raises questions about future upside after the recent rally. This shift in sentiment comes as consensus models grapple with how much enduring growth and margin improvement are possible amid shifting market dynamics.

The slower than expected rollout of Inspire V, driven by delays in center training, contracting, onboarding, and technical hurdles with implementing SleepSync, has materially reduced near-term revenue growth rates and deferred volume expansion. This has increased execution risk and could potentially cause a protracted recovery in revenue and margins into 2026.

Read the complete narrative.

Curious what bold growth assumptions drive this valuation, even as execution risks rise? Analysts are banking on aggressive revenue and profitability forecasts to justify today’s premium price tag. Dive in to see if the numbers back up the narrative or reveal some red flags beneath the surface.

Result: Fair Value of $117.73 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, execution snags and rising costs could derail recovery, especially if market adoption or reimbursement shifts fail to meet expectations.

Find out about the key risks to this Inspire Medical Systems narrative.

Build Your Own Inspire Medical Systems Narrative

If you have a different perspective or want hands-on insight, creating and customizing your own data-driven narrative takes just a few minutes. Do it your way

A great starting point for your Inspire Medical Systems research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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