InMode approves 10% buyback as stock trades near 52-week low
Medical technology company authorizes repurchase of 6.38 million shares, signaling confidence in undervalued stock
InMode shares surged in premarket trading Friday after the medical technology company's board approved a share repurchase program covering approximately 10% of its outstanding stock, signaling management's confidence that the shares are significantly undervalued.
The Israeli-based company, which specializes in minimally invasive aesthetic medical treatments, authorized the buyback of 6.38 million ordinary shares. InMode intends to fund the repurchases using available cash, supported by what it described as continued strong cash flow generation, according to a company announcement.
The move comes as InMode stock has struggled, falling approximately 15% from $15 to $12.76 over recent weeks and trading near its 52-week low of $12.95. The stock's relative strength index (RSI) has dropped to 25.6, indicating deeply oversold technical conditions that often precede rebounds.
"The company views repurchasing shares at its current valuation as an attractive use of capital," InMode said in the announcement.
InMode has demonstrated its commitment to shareholder returns through buybacks in the past. The company repurchased approximately $127.4 million of its ordinary shares throughout 2025, showing a track record of executing on capital allocation programs when it believes the stock represents compelling value.
The 10% authorization is particularly significant given the company's market capitalization of $832.5 million. At current prices, the full program would represent roughly $81 million in capital deployment, providing substantial support to the share price if fully executed.
Analysts maintain a generally positive outlook on the stock despite recent weakness. The consensus analyst target price of $16.80 represents approximately 32% upside from current levels, according to market data. Current ratings show six analysts at "Hold" and one at "Strong Buy."
The company appears attractively valued by traditional metrics, trading at a price-to-earnings ratio of 9.19 times trailing earnings and 2.25 times sales. InMode maintains strong profitability with a 25.3% profit margin and has generated $370.5 million in revenue over the trailing twelve months.
However, InMode faces business headwinds that have weighed on investor sentiment. The company reported a 3% year-over-year revenue decline in the first quarter of 2025 to $77.9 million, which contributed to analyst caution. Zacks Investment Research had projected earnings of $0.33 per share on $77.4 million in revenue for that period.
Canaccord Genuity and Needham maintained "Hold" ratings on InMode in February 2025, citing revenue shortfalls and the need for evidence of sustained growth before upgrading their positions.
The company's technology platform utilizes proprietary radio frequency (RF) technology for body contouring and skin treatments, competing in the rapidly growing medical aesthetics market. InMode's product portfolio includes devices for various minimally invasive procedures, positioning the company to benefit from increasing consumer demand for aesthetic treatments.
Management noted that it remains focused on navigating ongoing regional conflicts while maintaining a disciplined approach to capital allocation. The company indicated it will evaluate potential additional share repurchase programs and other capital allocation opportunities in the future.
For investors, the combination of technical oversold conditions, an aggressive share repurchase authorization representing 10% of the float, and attractive valuation multiples suggests the board sees current prices as an opportunity. The company's demonstrated ability to execute buybacks—returning $127.4 million to shareholders in 2025—provides credibility to its latest capital allocation announcement.
Whether the buyback will be sufficient to reverse the stock's recent downtrend will depend on InMode's ability to deliver improved operational performance and navigate the competitive landscape in medical aesthetics. Analysts will be watching closely for signs that revenue growth has stabilized when the company reports its next quarterly results.