While the S&P 500 is up 17.5% since March 2025, Inspired (currently trading at $9.17 per share) has lagged behind, posting a return of 6.4%. This was partly driven by its softer quarterly results and might have investors contemplating their next move.
Is now the time to buy Inspired, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Is Inspired Not Exciting?
We don't have much confidence in Inspired. Here are three reasons why INSE doesn't excite us and a stock we'd rather own.
1. Long-Term Revenue Growth Disappoints
A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last five years, Inspired grew its sales at a 13.4% annual rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the consumer discretionary sector, which enjoys a number of secular tailwinds.
2. Revenue Projections Show Stormy Skies Ahead
Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.
Over the next 12 months, sell-side analysts expect Inspired’s revenue to drop by 1.8%, a decrease from its 13.4% annualized growth for the past five years. This projection is underwhelming and implies its products and services will face some demand challenges.
3. Mediocre Free Cash Flow Margin Limits Reinvestment Potential
Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
Inspired has shown poor cash profitability over the last two years, giving the company limited opportunities to return capital to shareholders. Its free cash flow margin averaged 1.8%, lousy for a consumer discretionary business.
Final Judgment
Inspired’s business quality ultimately falls short of our standards. With its shares trailing the market in recent months, the stock trades at 2.4× forward EV-to-EBITDA (or $9.17 per share). While this valuation is reasonable, we don’t really see a big opportunity at the moment. We're fairly confident there are better stocks to buy right now. We’d suggest looking at our favorite semiconductor picks and shovels play.
Stocks We Would Buy Instead of Inspired
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