LifeStance Health Group, Inc. (NASDAQ:LFST) Analysts Are Pretty Bullish On The Stock After Recent Results

Investors in LifeStance Health Group, Inc. (NASDAQ:LFST) had a good week, as its shares rose 3.0% to close at US$6.86 following the release of its quarterly results. Revenues of US$300m arrived in line with expectations, although statutory losses per share were US$0.06, an impressive 26% smaller than what broker models predicted. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for LifeStance Health Group

After the latest results, the eight analysts covering LifeStance Health Group are now predicting revenues of US$1.22b in 2024. If met, this would reflect a notable 10% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 47% to US$0.24. Before this latest report, the consensus had been expecting revenues of US$1.22b and US$0.28 per share in losses. While the revenue estimates were largely unchanged, sentiment seems to have improved, with the analysts upgrading their numbers and making a cut to losses per share in particular.

These new estimates led to the consensus price target rising 12% to US$8.79, with lower forecast losses suggesting things could be looking up for LifeStance Health Group. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on LifeStance Health Group, with the most bullish analyst valuing it at US$10.00 and the most bearish at US$8.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that LifeStance Health Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 14% growth on an annualised basis. This is compared to a historical growth rate of 26% 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) 6.6% per year. Even after the forecast slowdown in growth, it seems obvious that LifeStance Health Group is also expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss 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. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for LifeStance Health Group going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 3 warning signs we've spotted with LifeStance Health Group .

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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.