Shareholders of Acutus Medical, Inc. (NASDAQ:AFIB) will be pleased this week, given that the stock price is up 15% to US$13.65 following its latest quarterly results. Revenues were 29% better than analyst models forecast, at US$3.6m. Perhaps unsurprisingly, statutory losses were also slightly larger than expected, at US$1.04 per share, reflecting the higher costs which were likely incurred in generating that revenue. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the most recent consensus for Acutus Medical from five analysts is for revenues of US$24.7m in 2021 which, if met, would be a sizeable 136% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 39% to US$3.79. Before this earnings announcement, the analysts had been modelling revenues of US$24.5m and losses of US$2.85 per share in 2021. While this year's revenue estimates held steady, there was also a regrettable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
The consensus price target fell 11% to US$18.75per share, with the analysts clearly concerned by ballooning losses. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Acutus Medical analyst has a price target of US$26.00 per share, while the most pessimistic values it at US$11.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of Acutus Medical'shistorical trends, as the 215% annualised revenue growth to the end of 2021 is roughly in line with the 188% annual revenue growth over the past year. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 7.9% annually. So it's pretty clear that Acutus Medical is forecast to grow substantially faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Acutus Medical's future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Acutus Medical going out to 2023, and you can see them free on our platform here.
Plus, you should also learn about the 3 warning signs we've spotted with Acutus Medical (including 1 which shouldn't be ignored) .
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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