DocGo Inc. Reported A Surprise Loss, And Analysts Have Updated Their Forecasts

Investors in DocGo Inc. (NASDAQ:DCGO) had a good week, as its shares rose 8.6% to close at US$8.85 following the release of its first-quarter results. Things were not great overall, with a surprise (statutory) loss of US$0.03 per share on revenues of US$113m, even though the analysts had been expecting a profit. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for DocGo

Taking into account the latest results, the most recent consensus for DocGo from six analysts is for revenues of US$503.8m in 2023 which, if met, would be a decent 16% increase on its sales over the past 12 months. Per-share earnings are expected to surge 39% to US$0.28. In the lead-up to this report, the analysts had been modelling revenues of US$504.4m and earnings per share (EPS) of US$0.25 in 2023. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$12.83, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. There are some variant perceptions on DocGo, with the most bullish analyst valuing it at US$15.00 and the most bearish at US$11.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting DocGo is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting DocGo's growth to accelerate, with the forecast 21% annualised growth to the end of 2023 ranking favourably alongside historical growth of 13% per annum 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 7.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect DocGo to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around DocGo's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. 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 DocGo going out to 2025, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for DocGo (1 is concerning) you should be aware of.

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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.