Analysts Just Made A Substantial Upgrade To Their Devyser Diagnostics AB (publ) (STO:DVYSR) Forecasts

Shareholders in Devyser Diagnostics AB (publ) (STO:DVYSR) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

Following the upgrade, the most recent consensus for Devyser Diagnostics from its two analysts is for revenues of kr248m in 2024 which, if met, would be a sizeable 37% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 88% to kr0.35 per share. Yet before this consensus update, the analysts had been forecasting revenues of kr225m and losses of kr1.74 per share in 2024. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for Devyser Diagnostics

Despite these upgrades, the analysts have not made any major changes to their price target of kr.80.21, implying that their latest estimates don't have a long term impact on what they think the stock is worth. 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. Currently, the most bullish analyst values Devyser Diagnostics at kr.81.83 per share, while the most bearish prices it at kr.78.59. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Devyser Diagnostics is an easy business to forecast or the underlying assumptions are obvious.

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 Devyser Diagnostics' rate of growth is expected to accelerate meaningfully, with the forecast 52% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 33% over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 17% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Devyser Diagnostics to grow faster than the wider industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Devyser Diagnostics' prospects. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at Devyser Diagnostics.

It's great to see the analysts upgrading their estimates, but the biggest highlight to us is that the business is expected to become profitable in the foreseeable future. For more information, you can click through to our free platform to learn more about these forecasts.

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

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com