Headwaters Capital Management, an investment management company, released its third-quarter 2023 investor letter. A copy of the same can be downloaded here. The fund declined -7.6% (-7.8% net) in the third quarter compared to a -4.7% return for the Russell Mid Cap Index. The YTD results stand at +14.2% (+13.5% net) compared to a +3.9% return for the index. The firm remains optimistic about the prospects of the companies in its portfolio. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Headwaters Capital Management highlighted stocks like Inspire Medical Systems, Inc. (NYSE:INSP) in the third quarter 2023 investor letter. Headquartered in Golden Valley, Minnesota, Inspire Medical Systems, Inc. (NYSE:INSP) is a medical technology company. On November 10, 2023, Inspire Medical Systems, Inc. (NYSE:INSP) stock closed at $125.70 per share. One-month return of Inspire Medical Systems, Inc. (NYSE:INSP) was -16.46%, and its shares lost 41.621% of their value over the last 52 weeks. Inspire Medical Systems, Inc. (NYSE:INSP) has a market capitalization of $3.711 billion.
Headwaters Capital Management made the following comment about Inspire Medical Systems, Inc. (NYSE:INSP) in its Q3 2023 investor letter:
“Top Detractor: Inspire Medical Systems, Inc. (NYSE:INSP) -39% : Inspire Medical was squarely in the cross-hairs of the weight loss drug fears during Q3. Investors are concerned that weight loss drugs will result in lower levels of obesity, the leading cause of sleep apnea, which will negatively impact INSP’s sales. I believe this is a case of “shoot first, ask questions later” given that the ultimate impact is likely years away. However, I believe INSP is insulated from the GLP-1 fears even if there is broad adoption of these drugs. INSP’s neurostimulation device for treating sleep apnea is not approved for patients with a body mass index (“BMI”) > 40. As it stands today, there is a large population of CPAP patients that cannot be treated by INSP due to this label indication. If these patients with a BMI > 40 begin taking weight loss drugs and reduce BMI into the target indication range, this will add a new population of patients that INSP can treat. While INSP’s sales funnel will also lose some patients who no longer need INSP therapy thanks to weight loss drugs, the net result is likely neutral to positive for INSP. Time will ultimately tell how this plays out, but I do believe current fears are overblown.”
A medical professional performing a minimally invasive procedure while using the company’s technology.
Inspire Medical Systems, Inc. (NYSE:INSP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 47 hedge fund portfolios held Inspire Medical Systems, Inc. (NYSE:INSP) at the end of second quarter which was 40 in the previous quarter.
We discussed Inspire Medical Systems, Inc. (NYSE:INSP) in another article and shared the list of best long-term stocks to buy for high returns. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
