Inspire Medical Systems Inc's stock plummeted by 21.35% in pre-market trading, hitting a 5-day low. This significant decline follows the company's announcement of a class action lawsuit related to the failed launch of its Inspire V sleep apnea device, which has raised serious concerns among investors regarding the company's operational capabilities and future prospects.
The stock's drop is attributed to the ongoing legal challenges and the company's inability to meet market expectations, particularly after slashing its earnings guidance for 2025 by over 80%. Investors are reacting to the news of the class action lawsuit, which alleges misleading statements about the product launch and operational issues, leading to a crisis of confidence in the company's management and its ability to recover from these setbacks.
As the market remains generally strong, with the Nasdaq-100 up 1.33% and the S&P 500 up 0.76%, the sharp decline in Inspire Medical's stock reflects a significant sector rotation, as investors reassess their positions in light of the company's recent troubles.
Wall Street analysts forecast INSP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for INSP is 145.31 USD with a low forecast of 91.00 USD and a high forecast of 180.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
19 Analyst Rating
Wall Street analysts forecast INSP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for INSP is 145.31 USD with a low forecast of 91.00 USD and a high forecast of 180.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
13 Buy
6 Hold
0 Sell
Moderate Buy
Current: 82.010
Low
91.00
Averages
145.31
High
180.00
Current: 82.010
Low
91.00
Averages
145.31
High
180.00
RBC Capital
Outperform -> Sector Perform
downgrade
$175 -> $90
2026-01-26
New
Reason
RBC Capital
Price Target
$175 -> $90
AI Analysis
2026-01-26
New
downgrade
Outperform -> Sector Perform
Reason
RBC Capital downgraded Inspire Medical to Sector Perform from Outperform with a price target of $90, down from $175. The firm's Expert checks suggest Inspire V coding headwinds are likely to persist, creating physician disincentive and also putting them at a competitive disadvantage, the analyst tells investors in a research note. While Inspire's 2026 guidance does not include higher reimbursement, the firm is lowering its 2026 estimates on lower expected utilization.
Oppenheimer
analyst
Outperform
to
Perform
downgrade
2026-01-22
Reason
Oppenheimer
analyst
Price Target
2026-01-22
downgrade
Outperform
to
Perform
Reason
As previously reported, Oppenheimer downgraded Inspire Medical to Perform from Outperform and removed the firm's price target after the Centers for Medicare & Medicaid Services issued a correction, essentially stating "it incorrectly added Obstructive Sleep Apnea as a covered indication under the vagus nerve stimulation NCD." Billing under CPT 64582 and modifier 52 "ends up being net negative" for Inspire, says the analyst, who confesses that "the timing of our upgrade given this reimbursement blunder" was "unfortunate."
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Outperform -> Perform
downgrade
2026-01-22
Reason
Price Target
2026-01-22
downgrade
Outperform -> Perform
Reason
Oppenheimer downgraded Inspire Medical to Perform from Outperform.
Evercore ISI
Daniel Markowitz
Outperform
maintain
$125
2026-01-22
Reason
Evercore ISI
Daniel Markowitz
Price Target
$125
2026-01-22
maintain
Outperform
Reason
Evercore ISI analyst Daniel Markowitz notes that the Centers for Medicare & Medicaid Services has issued an update effectively stating that hospitals and ASCs should not qualify for a reimbursement uplift for Inspire Medical V procedures, which has been been a great source of debate over the past month. CMS clarified that the ICD-10 diagnosis code for Obstructive Sleep Apnea was incorrectly added as a covered indication for CPT code 64568 under NCD 160.18 and is now being removed. The firm believes the company's FY26 guide should be intact and notes that the stock has roughly round tripped its move from the past 3 months. Evercore has an Outperform rating on the shares with a price target of $125.
About INSP
Inspire Medical Systems, Inc. is a medical technology company. The Company is focused on the development and commercialization of advanced, minimally invasive solutions for patients with obstructive sleep apnea (OSA). Its proprietary Inspire therapy is FDA, EU MDR, and PDMA-approved neurostimulation technology that provides a safe and effective treatment for moderate to severe obstructive sleep apnea. It has developed a novel, closed-loop solution that continuously monitors a patient’s breathing and delivers mild hypoglossal nerve stimulation to maintain an open airway. The Company sells its Inspire system to hospitals and ambulatory surgery centers (ASCs) in the United States (U.S.) and in select countries in Europe and Japan through a direct sales organization and sells its Inspire system in Singapore and Hong Kong through distributors. Its direct sales force engages in sales efforts and promotional activities focused on ear, nose and throat (ENT) physicians and sleep centers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
