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Why Diabetes Stock Insulet Jumped 15.7% in February

By Beth McKenna - Updated Apr 10, 2019 at 1:05PM

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The leader in tubeless insulin pump technology acheived full-year profitability for the first time in 2018.

What happened

Insulet ( PODD 1.33% ) stock jumped 15.7% last month, according to data from S&P Global Market Intelligence. Shares are up 29.5% for the one-year period through Friday, March 1.

The Massachusetts-based company is the leader in tubeless insulin pump technology with its Omnipod pump.

For context, the S&P 500 index returned 3.2% in February, and has returned 6.8% over the last year.

A two-pane image with top pane showing an Omnipod attached to a woman's lower stomach and the bottom pane showing the hand-held control for the device.

Image source: Getty Images.

So what

On Feb. 25, Insulet released strong fourth-quarter and full-year 2018 results, though the stock gained just 2.4% the next day and 4% over the two-day period following the release. So while this event contributed to the stock's rise last month, it doesn't explain the full gain.

Other than the earnings release, Insulet didn't make any significant announcements in February, nor was it the specific subject of any notable news. So other than the boost it received from the earnings release, we can't say for sure why Insulet stock had a good month last month. Diabetes stocks in general were strong performers in February with shares of Tandem Diabetes and Senseonics, for instance, gaining 50.8% and 19.1%, respectively, so Insulet's rise was likely in part tied to strength of the overall group. 

In the fourth quarter, Insulet's revenue grew 26% year over year to $164.9 million, surpassing the $162.5 million Wall Street was looking for. The company posted earnings per share (EPS) of $0.16 -- versus a loss of $0.12 per share in the year-ago period -- easily beating the consensus estimate of $0.07. The quarter marked only the second time that Insulet has posted positive quarterly earnings, with the third quarter being the first time. 

Check out the latest earnings call transcript for Insulet.

Now what

For the first quarter of 2019, Insulet guided for revenue growth of about 23% to 27% year over year. And for full-year 2019, it expects revenue to increase about 17% to 22% year over year. The company doesn't provide earnings guidance.

Insulet has a solid history of beating its revenue guidance, so these growth figures could prove conservative.

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