Need To Know: Analysts Are Much More Bullish On Futura Medical plc (LON:FUM)

Futura Medical plc (LON:FUM) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

Following the upgrade, the latest consensus from Futura Medical's three analysts is for revenues of UK£13m in 2024, which would reflect a sizeable 61% improvement in sales compared to the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of UK£0.0017 per share this year. Yet prior to the latest estimates, the analysts had been forecasting revenues of UK£9.5m and losses of UK£0.01 per share in 2024. So we can see that this has sparked a pretty clear upgrade to expectations, with higher revenues anticipated to lead to profit sooner than previously forecast.

Check out our latest analysis for Futura Medical

It will come as no surprise to learn that the analysts have increased their price target for Futura Medical 5.8% to UK£1.34 on the back of these upgrades.

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 Futura Medical's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 61% growth on an annualised basis. This is compared to a historical growth rate of 93% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.1% annually. Even after the forecast slowdown in growth, it seems obvious that Futura Medical is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that there is now an expectation for Futura Medical to become profitable this year, compared to previous expectations of a loss. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Futura Medical could be worth investigating further.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Futura Medical analysts - going out to 2026, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.