Analyst Estimates: Here's What Brokers Think Of dentalcorp Holdings Ltd. (TSE:DNTL) After Its First-Quarter Report

There's been a notable change in appetite for dentalcorp Holdings Ltd. (TSE:DNTL) shares in the week since its first-quarter report, with the stock down 14% to CA$7.25. The results don't look great, especially considering that statutory losses grew 157% toCA$0.18 per share. Revenues of CA$358m did beat expectations by 3.8%, but it looks like a bit of a cold comfort. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for dentalcorp Holdings

Taking into account the latest results, the current consensus from dentalcorp Holdings' eight analysts is for revenues of CA$1.44b in 2023, which would reflect a solid 8.1% increase on its sales over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 55% to CA$0.093. Yet prior to the latest earnings, the analysts had been forecasting revenues of CA$1.44b and losses of CA$0.067 per share in 2023. So it's pretty clear the analysts have mixed opinions on dentalcorp Holdings even after this update; although they reconfirmed their revenue numbers, it came at the cost of a massive increase in per-share losses.

The consensus price target held steady at CA$14.06, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic dentalcorp Holdings analyst has a price target of CA$16.00 per share, while the most pessimistic values it at CA$13.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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 pretty clear that there is an expectation that dentalcorp Holdings' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 25% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.0% annually. Even after the forecast slowdown in growth, it seems obvious that dentalcorp Holdings is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at dentalcorp Holdings. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple dentalcorp Holdings analysts - going out to 2024, and you can see them free on our platform here.

Even so, be aware that dentalcorp Holdings is showing 2 warning signs in our investment analysis , you should know about...

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.