Analysts Have Been Trimming Their AtriCure, Inc. (NASDAQ:ATRC) Price Target After Its Latest Report

There's been a notable change in appetite for AtriCure, Inc. (NASDAQ:ATRC) shares in the week since its second-quarter report, with the stock down 11% to US$21.04. The results overall were pretty much dead in line with analyst forecasts; revenues were US$116m and statutory losses were US$0.17 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for AtriCure

Taking into account the latest results, the current consensus from AtriCure's nine analysts is for revenues of US$458.1m in 2024. This would reflect a credible 6.5% increase on its revenue over the past 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.80. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$461.8m and losses of US$0.78 per share in 2024. So it's pretty clear consensus is mixed on AtriCure after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a moderate increase in per-share loss expectations.

With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 11% to US$39.89, with the analysts signalling that growing losses would be a definite concern. 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 AtriCure analyst has a price target of US$60.00 per share, while the most pessimistic values it at US$26.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for 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 2024 brings more of the same, according to the analysts, with revenue forecast to display 14% growth on an annualised basis. That is in line with its 16% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 8.1% per year. So although AtriCure 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 the analysts increased their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of AtriCure's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on AtriCure. Long-term earnings power is much more important than next year's profits. We have forecasts for AtriCure going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for AtriCure that we have uncovered.

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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.

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