Need To Know: The Consensus Just Cut Its Accelerate Diagnostics, Inc. (NASDAQ:AXDX) Estimates For 2022

Market forces rained on the parade of Accelerate Diagnostics, Inc. (NASDAQ:AXDX) 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.

Following the downgrade, the current consensus from Accelerate Diagnostics' four analysts is for revenues of US$14m in 2022 which - if met - would reflect a decent 16% increase on its sales over the past 12 months. Per-share losses are expected to see a sharp uptick, reaching US$1.24. Yet before this consensus update, the analysts had been forecasting revenues of US$16m and losses of US$1.13 per share in 2022. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

Check out our latest analysis for Accelerate Diagnostics

The consensus price target fell 38% to US$5.00, implicitly signalling that lower earnings per share are a leading indicator for Accelerate Diagnostics' valuation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Accelerate Diagnostics' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Accelerate Diagnostics' revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 35% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.8% per year. Even after the forecast slowdown in growth, it seems obvious that Accelerate Diagnostics is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Accelerate Diagnostics. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Accelerate Diagnostics' future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Accelerate Diagnostics after today.

That said, the analysts might have good reason to be negative on Accelerate Diagnostics, given dilutive stock issuance over the past year. Learn more, and discover the 4 other risks we've identified, for 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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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.