Pro Medicus Limited Just Missed EPS By 14%: Here's What Analysts Think Will Happen Next

Pro Medicus Limited (ASX:PME) missed earnings with its latest interim results, disappointing overly-optimistic forecasters. Pro Medicus missed earnings this time around, with AU$32m revenue coming in 8.2% below what the analysts had modelled. Statutory earnings per share (EPS) of AU$0.13 also fell short of expectations by 14%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Pro Medicus

Taking into account the latest results, the most recent consensus for Pro Medicus from seven analysts is for revenues of AU$70.0m in 2021 which, if met, would be a major 23% increase on its sales over the past 12 months. Statutory earnings per share are predicted to soar 25% to AU$0.30. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$69.7m and earnings per share (EPS) of AU$0.28 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 31% to AU$40.82. 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 Pro Medicus analyst has a price target of AU$53.80 per share, while the most pessimistic values it at AU$23.05. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the 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. It's clear from the latest estimates that Pro Medicus' rate of growth is expected to accelerate meaningfully, with the forecast 23% revenue growth noticeably faster than its historical growth of 13% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 20% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Pro Medicus is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Pro Medicus following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Pro Medicus going out to 2025, and you can see them free on our platform here..

Plus, you should also learn about the 1 warning sign we've spotted with Pro Medicus .

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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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