Analyst Estimates: Here's What Brokers Think Of Merit Medical Systems, Inc. (NASDAQ:MMSI) After Its Full-Year Report

Last week, you might have seen that Merit Medical Systems, Inc. (NASDAQ:MMSI) released its full-year result to the market. The early response was not positive, with shares down 4.4% to US$76.26 in the past week. The result was positive overall - although revenues of US$1.3b were in line with what the analysts predicted, Merit Medical Systems surprised by delivering a statutory profit of US$1.62 per share, modestly greater than expected. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Merit Medical Systems

Taking into account the latest results, the most recent consensus for Merit Medical Systems from nine analysts is for revenues of US$1.32b in 2024. If met, it would imply a reasonable 5.0% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 45% to US$2.37. In the lead-up to this report, the analysts had been modelling revenues of US$1.33b and earnings per share (EPS) of US$2.38 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$94.22, showing that the business is executing well and in line with expectations. 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. Currently, the most bullish analyst values Merit Medical Systems at US$112 per share, while the most bearish prices it at US$81.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Merit Medical Systems shareholders.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Merit Medical Systems' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.0% growth on an annualised basis. This is compared to a historical growth rate of 6.4% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 7.8% annually. Factoring in the forecast slowdown in growth, it seems obvious that Merit Medical Systems is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Merit Medical Systems' revenue is expected to perform worse 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 in mind, we wouldn't be too quick to come to a conclusion on Merit Medical Systems. Long-term earnings power is much more important than next year's profits. We have forecasts for Merit Medical Systems going out to 2026, and you can see them free on our platform here.

You can also view our analysis of Merit Medical Systems' balance sheet, and whether we think Merit Medical Systems is carrying too much debt, for free on our platform here.

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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.