The MicroPort CardioFlow Medtech Corporation (HKG:2160) Analysts Have Been Trimming Their Sales Forecasts

Market forces rained on the parade of MicroPort CardioFlow Medtech Corporation (HKG:2160) shareholders today, when the analysts downgraded their forecasts for this year. Revenue estimates were cut sharply as the analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

After this downgrade, MicroPort CardioFlow Medtech's five analysts are now forecasting revenues of CN¥349m in 2023. This would be a substantial 39% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing CN¥438m of revenue in 2023. The consensus view seems to have become more pessimistic on MicroPort CardioFlow Medtech, noting the pretty serious reduction to revenue estimates in this update.

Check out our latest analysis for MicroPort CardioFlow Medtech

The consensus price target fell 19% to CN¥3.42, with the analysts clearly less optimistic about MicroPort CardioFlow Medtech's valuation following this update. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values MicroPort CardioFlow Medtech at CN¥6.00 per share, while the most bearish prices it at CN¥2.50. We would probably assign less value to the forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily on the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 39% growth on an annualised basis. That is in line with its 47% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 27% per year. So although MicroPort CardioFlow Medtech is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. Analysts also expect revenues to grow faster than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Given the stark change in sentiment, we'd understand if investors became more cautious on MicroPort CardioFlow Medtech after today.

Of course, there's always more to the story. We have estimates for MicroPort CardioFlow Medtech from its five analysts out until 2025, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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