Here's What Analysts Are Forecasting For CareMax, Inc. (NASDAQ:CMAX) After Its First-Quarter Results

CareMax, Inc. (NASDAQ:CMAX) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. Revenues missed expectations somewhat, coming in at US$173m, but statutory earnings fell catastrophically short, with a loss of US$0.74 some 573% larger than what the analysts had predicted. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for CareMax

Following the latest results, CareMax's four analysts are now forecasting revenues of US$729.9m in 2023. This would be a meaningful 9.4% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 55% to US$0.42. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$767.1m and losses of US$0.49 per share in 2023. Although the revenue estimates have fallen somewhat, CareMax'sfuture looks a little different to the past, with a notable improvement in the loss per share forecasts in particular.

The consensus price target was broadly unchanged at US$6.75, implying that the business is performing roughly in line with expectations, despite adjustments to both revenue and earnings estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on CareMax, with the most bullish analyst valuing it at US$13.00 and the most bearish at US$4.00 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that CareMax's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 79% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.6% per year. Even after the forecast slowdown in growth, it seems obvious that CareMax is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also downgraded their revenue estimates, although industry data suggests that CareMax's revenues are expected to grow faster than the wider industry. Even so, earnings are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for CareMax going out to 2025, and you can see them free on our platform here.

Even so, be aware that CareMax is showing 3 warning signs in our investment analysis , you should know about...

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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.