What happened

Shares of medical-device maker InMode (INMD 1.34%) popped on Tuesday after the company released preliminary financial results for the second quarter of 2022 and raised full-year revenue guidance. As of noon ET today, InMode stock was up 16%.

So what

InMode will announce finalized second-quarter results on July 28. But its preliminary estimates surpassed expectations. The company expects to report revenue of $113 million to $113.3 million, a year-over-year increase between 29% and 30%. Not only that, management raised revenue guidance for 2022 from a range of $415 million to $425 million to a range of $425 million to $435 million.

Even with today's 16% gain, InMode stock trades at a price-to-earnings valuation of just 13, placing it firmly in value-stock territory. However, it trades at such a cheap valuation because investors believed it would be hard to grow in 2022, given the challenging macroeconomic conditions. After all, many procedures with InMode's devices are cosmetic and could be postponed or canceled if consumers' financial situations worsen. 

By raising guidance, InMode is causing skeptics to rethink their opinions about the stock.

Now what

Revenue growth is nice. But investors are also celebrating the company's profitability. In today's press release, management said it expects adjusted earnings per share (EPS) of $0.57 to $0.58 compared to split-adjusted EPS of $0.51 last year. That's a significant increase, considering how inflation makes earnings growth challenging for almost all companies. It will be interesting to listen to management's commentary when it reports official second-quarter results to hear more about what the company is doing right.

Editor's note: A previous version of this article erroneously stated that year-over-year earnings per share would fall, failing to take into account InMode's 2-for-1 stock split last year. The author and the Fool regret the error.