This Broker Just Slashed Their LENSAR, Inc. (NASDAQ:LNSR) Earnings Forecasts

One thing we could say about the covering analyst on LENSAR, Inc. (NASDAQ:LNSR) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) estimates were cut sharply as the analyst factored in the latest outlook for the business, concluding that they were too optimistic previously.

After this downgrade, LENSAR's one analyst is now forecasting revenues of US$43m in 2023. This would be a major 22% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 29% to US$1.28. Yet prior to the latest estimates, the analyst had been forecasting revenues of US$48m and losses of US$0.91 per share in 2023. Ergo, there's been a clear change in sentiment, with the analyst administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

See our latest analysis for LENSAR

The consensus price target fell 14% to US$12.00, with the analyst clearly concerned about the company following the weaker revenue and earnings outlook.

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 analyst is definitely expecting LENSAR's growth to accelerate, with the forecast 22% annualised growth to the end of 2023 ranking favourably alongside historical growth of 11% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.5% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that LENSAR is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analyst increased their loss per share estimates for this year. Unfortunately, the analyst also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. Given the scope of the downgrades, it would not be a surprise to see the market become more wary of the business.

As you can see, the analyst clearly isn't bullish, and there might be good reason for that. We've identified some potential issues with LENSAR's financials, such as a short cash runway. Learn more, and discover the 2 other concerns 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.