Mairs & Power Small Cap Fund Q4 2025 Investor Letter Insights
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 06 2026
0mins
Should l Buy INSP?
Source: Yahoo Finance
- Market Performance Analysis: In 2025, the Mairs & Power Small Cap Fund returned 3.98%, significantly trailing the Russell 2000 Total Return Index's 12.81%, highlighting the challenges faced by small-cap stocks amid macroeconomic headwinds and a bubble in technology and AI investments.
- Impact of Stock Selection: Stock selection in Health Care, Information Technology, and Materials notably influenced the fund's performance, with overall sector allocation contributing positively, yet the rebound of small-cap stocks in the latter half of the year indicates market resilience.
- Inspire Medical Systems Performance: Inspire Medical Systems reported a 12% revenue increase to $269 million in Q4 2025, despite challenges in product rollout and reimbursement code setup, with a market capitalization of $1.57 billion, showcasing its potential in a large addressable market.
- Future Outlook: Looking ahead to 2026, the fund remains optimistic about small-cap stocks expected to grow at or above the S&P 500 rate, although it expresses caution regarding certain AI stocks, suggesting they may offer better risk-reward profiles.
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Analyst Views on INSP
Wall Street analysts forecast INSP stock price to rise
19 Analyst Rating
13 Buy
6 Hold
0 Sell
Moderate Buy
Current: 57.590
Low
91.00
Averages
145.31
High
180.00
Current: 57.590
Low
91.00
Averages
145.31
High
180.00
About INSP
Inspire Medical Systems, Inc. is a medical technology company. The Company focuses on the development and commercialization of advanced, minimally invasive solutions for patients with obstructive sleep apnea (OSA). Its proprietary Inspire therapy is neurostimulation technology that provides safe and effective treatment for moderate to severe obstructive sleep apnea. The Company's closed-loop solution 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.
Mairs & Power Small Cap Fund Q4 2025 Investor Letter Insights
- Market Performance Analysis: In 2025, the Mairs & Power Small Cap Fund returned 3.98%, significantly trailing the Russell 2000 Total Return Index's 12.81%, highlighting the challenges faced by small-cap stocks amid macroeconomic headwinds and a bubble in technology and AI investments.
- Impact of Stock Selection: Stock selection in Health Care, Information Technology, and Materials notably influenced the fund's performance, with overall sector allocation contributing positively, yet the rebound of small-cap stocks in the latter half of the year indicates market resilience.
- Inspire Medical Systems Performance: Inspire Medical Systems reported a 12% revenue increase to $269 million in Q4 2025, despite challenges in product rollout and reimbursement code setup, with a market capitalization of $1.57 billion, showcasing its potential in a large addressable market.
- Future Outlook: Looking ahead to 2026, the fund remains optimistic about small-cap stocks expected to grow at or above the S&P 500 rate, although it expresses caution regarding certain AI stocks, suggesting they may offer better risk-reward profiles.
See More
Inspire Medical Systems Stock Shows Oversold Signal
- Oversold Indicator: Inspire Medical Systems' RSI has dropped to 29.2, indicating that the stock has entered oversold territory after hitting a low of $54.82, suggesting that the recent heavy selling may be exhausting, prompting bullish investors to seek buying opportunities.
- Market Comparison: Compared to the S&P 500 ETF's RSI of 41.5, INSP's oversold status may attract bullish investors, indicating a potential reversal in market sentiment.
- Price Fluctuation: INSP's 52-week low is $53.11 and the high is $172.95, with the current trading price at $55.15, indicating that the stock is hovering near its low, potentially providing value buying opportunities for investors.
- Investor Interest: With INSP's oversold signal, investors may also look into nine other oversold stocks, reflecting the market's interest in undervalued stocks and potential investment opportunities.
See More
KSF Launches Investigation into Inspire Medical Systems
- Investigation Launched: Former Louisiana Attorney General Charles C. Foti announces that KSF has initiated an investigation into Inspire Medical Systems, focusing on whether its executives breached fiduciary duties to shareholders, potentially impacting corporate governance.
- Earnings Guidance Cut: Inspire slashed its 2025 earnings forecast from $2.20-$2.30 per share to $0.40-$0.50, a reduction exceeding 80%, indicating failure to meet necessary training and contracting requirements prior to product launch, leading to weak market demand.
- Increased Legal Risks: Inspire and its executives are facing a securities class action lawsuit for failing to disclose material information, which could result in substantial financial penalties and reputational damage, further eroding investor confidence.
- Negative Market Reaction: The ongoing investigation and drastic earnings cut may exert significant pressure on Inspire's stock price, prompting investors to closely monitor subsequent legal developments and corporate governance improvements.
See More
Inspire Medical Systems Shares Rise 15% on Positive CMS Coding News
- Stock Surge: Inspire Medical Systems' shares rose approximately 15% on Thursday, driven by KeyBanc Capital Markets' positive outlook regarding CMS's potential addition of several codes for the company's Inspire V implant for sleep apnea.
- New Coding Announcement: The MLN Connects newsletter referenced by KeyBanc indicates that new codes will take effect on January 1, 2026, covering the implantation, replacement, and removal of neurostimulator arrays and pulse generators, highlighting CMS's commitment to improving coding accuracy.
- Positive Market Reaction: Analysts Brett Fishbin and William Korner noted that while this development is still in its early stages, it is viewed as a positive signal that could expedite clarity on permanent and product-specific payment approaches, potentially impacting the company's future revenue.
- Revenue Outlook: Inspire Medical Systems projects a revenue outlook of $950 million to $1 billion for 2026, and despite facing coding changes and reimbursement headwinds, analysts remain optimistic about the company's growth potential.
See More
Inspire Medical Systems Faces Near-Term Challenges
- Price Target Reduction: Stifel lowered its price target for Inspire Medical Systems from $110 to $95 while maintaining a Buy rating, indicating ongoing reimbursement challenges that impact the company's operations and billing environment.
- Profitability Constraints: Although Inspire's projected revenue growth for 2026 remains in the high single digits, the implementation of a new CPT code could reduce physician payments by 10%-50%, potentially slowing procedure volumes and new account growth, thereby affecting future performance.
- Widespread Rating Downgrades: Baird and Wells Fargo downgraded Inspire's ratings to Neutral and Equal Weight, respectively, citing uncertainty around physician reimbursements and a weaker growth outlook for 2026, which raises concerns about the company's future performance.
- Strong Financial Performance: Despite challenges, Inspire reported a 12% year-over-year revenue increase in Q4, with earnings of $1.65 per share exceeding expectations and margins improving to 17.5%, demonstrating the company's potential for profitability amidst headwinds.
See More
KSF Launches Investigation into Inspire Medical Systems
- Investigation Launched: Former Louisiana Attorney General Charles C. Foti announced that KSF has initiated an investigation into Inspire Medical Systems, focusing on whether its executives breached fiduciary duties, which could impact corporate governance.
- Earnings Guidance Cut: Inspire Medical Systems slashed its 2025 earnings forecast from $2.20-$2.30 per share to $0.40-$0.50, a reduction exceeding 80%, indicating failure to meet necessary training and contracting requirements prior to product launch, leading to weak market demand.
- Legal Action Risks: The company and its executives are facing a securities class action lawsuit for failing to disclose material information, which could result in further financial losses and damage to reputation, affecting investor confidence.
- Negative Market Reaction: Due to the investigation and earnings cut, Inspire Medical Systems' stock price may face ongoing pressure, prompting investors to monitor subsequent legal developments and corporate governance improvements.
See More
Mairs & Power Small Cap Fund Q4 2025 Investor Letter Insights
- Market Performance Analysis: In 2025, the Mairs & Power Small Cap Fund returned 3.98%, significantly trailing the Russell 2000 Total Return Index's 12.81%, highlighting the challenges faced by small-cap stocks amid macroeconomic headwinds and a bubble in technology and AI investments.
- Impact of Stock Selection: Stock selection in Health Care, Information Technology, and Materials notably influenced the fund's performance, with overall sector allocation contributing positively, yet the rebound of small-cap stocks in the latter half of the year indicates market resilience.
- Inspire Medical Systems Performance: Inspire Medical Systems reported a 12% revenue increase to $269 million in Q4 2025, despite challenges in product rollout and reimbursement code setup, with a market capitalization of $1.57 billion, showcasing its potential in a large addressable market.
- Future Outlook: Looking ahead to 2026, the fund remains optimistic about small-cap stocks expected to grow at or above the S&P 500 rate, although it expresses caution regarding certain AI stocks, suggesting they may offer better risk-reward profiles.
See More
Inspire Medical Systems Stock Shows Oversold Signal
- Oversold Indicator: Inspire Medical Systems' RSI has dropped to 29.2, indicating that the stock has entered oversold territory after hitting a low of $54.82, suggesting that the recent heavy selling may be exhausting, prompting bullish investors to seek buying opportunities.
- Market Comparison: Compared to the S&P 500 ETF's RSI of 41.5, INSP's oversold status may attract bullish investors, indicating a potential reversal in market sentiment.
- Price Fluctuation: INSP's 52-week low is $53.11 and the high is $172.95, with the current trading price at $55.15, indicating that the stock is hovering near its low, potentially providing value buying opportunities for investors.
- Investor Interest: With INSP's oversold signal, investors may also look into nine other oversold stocks, reflecting the market's interest in undervalued stocks and potential investment opportunities.
See More
KSF Launches Investigation into Inspire Medical Systems
- Investigation Launched: Former Louisiana Attorney General Charles C. Foti announces that KSF has initiated an investigation into Inspire Medical Systems, focusing on whether its executives breached fiduciary duties to shareholders, potentially impacting corporate governance.
- Earnings Guidance Cut: Inspire slashed its 2025 earnings forecast from $2.20-$2.30 per share to $0.40-$0.50, a reduction exceeding 80%, indicating failure to meet necessary training and contracting requirements prior to product launch, leading to weak market demand.
- Increased Legal Risks: Inspire and its executives are facing a securities class action lawsuit for failing to disclose material information, which could result in substantial financial penalties and reputational damage, further eroding investor confidence.
- Negative Market Reaction: The ongoing investigation and drastic earnings cut may exert significant pressure on Inspire's stock price, prompting investors to closely monitor subsequent legal developments and corporate governance improvements.
See More
Inspire Medical Systems Shares Rise 15% on Positive CMS Coding News
- Stock Surge: Inspire Medical Systems' shares rose approximately 15% on Thursday, driven by KeyBanc Capital Markets' positive outlook regarding CMS's potential addition of several codes for the company's Inspire V implant for sleep apnea.
- New Coding Announcement: The MLN Connects newsletter referenced by KeyBanc indicates that new codes will take effect on January 1, 2026, covering the implantation, replacement, and removal of neurostimulator arrays and pulse generators, highlighting CMS's commitment to improving coding accuracy.
- Positive Market Reaction: Analysts Brett Fishbin and William Korner noted that while this development is still in its early stages, it is viewed as a positive signal that could expedite clarity on permanent and product-specific payment approaches, potentially impacting the company's future revenue.
- Revenue Outlook: Inspire Medical Systems projects a revenue outlook of $950 million to $1 billion for 2026, and despite facing coding changes and reimbursement headwinds, analysts remain optimistic about the company's growth potential.
See More
Inspire Medical Systems Faces Near-Term Challenges
- Price Target Reduction: Stifel lowered its price target for Inspire Medical Systems from $110 to $95 while maintaining a Buy rating, indicating ongoing reimbursement challenges that impact the company's operations and billing environment.
- Profitability Constraints: Although Inspire's projected revenue growth for 2026 remains in the high single digits, the implementation of a new CPT code could reduce physician payments by 10%-50%, potentially slowing procedure volumes and new account growth, thereby affecting future performance.
- Widespread Rating Downgrades: Baird and Wells Fargo downgraded Inspire's ratings to Neutral and Equal Weight, respectively, citing uncertainty around physician reimbursements and a weaker growth outlook for 2026, which raises concerns about the company's future performance.
- Strong Financial Performance: Despite challenges, Inspire reported a 12% year-over-year revenue increase in Q4, with earnings of $1.65 per share exceeding expectations and margins improving to 17.5%, demonstrating the company's potential for profitability amidst headwinds.
See More
KSF Launches Investigation into Inspire Medical Systems
- Investigation Launched: Former Louisiana Attorney General Charles C. Foti announced that KSF has initiated an investigation into Inspire Medical Systems, focusing on whether its executives breached fiduciary duties, which could impact corporate governance.
- Earnings Guidance Cut: Inspire Medical Systems slashed its 2025 earnings forecast from $2.20-$2.30 per share to $0.40-$0.50, a reduction exceeding 80%, indicating failure to meet necessary training and contracting requirements prior to product launch, leading to weak market demand.
- Legal Action Risks: The company and its executives are facing a securities class action lawsuit for failing to disclose material information, which could result in further financial losses and damage to reputation, affecting investor confidence.
- Negative Market Reaction: Due to the investigation and earnings cut, Inspire Medical Systems' stock price may face ongoing pressure, prompting investors to monitor subsequent legal developments and corporate governance improvements.
See More
