Time To Worry? Analysts Are Downgrading Their NantHealth, Inc. (NASDAQ:NH) Outlook

Today is shaping up negative for NantHealth, Inc. (NASDAQ:NH) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following the latest downgrade, the two analysts covering NantHealth provided consensus estimates of US$69m revenue in 2021, which would reflect a noticeable 5.2% decline on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 35% to US$0.52. Yet before this consensus update, the analysts had been forecasting revenues of US$79m and losses of US$0.41 per share in 2021. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

Check out our latest analysis for NantHealth

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the NantHealth's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 5.2% by the end of 2021. This indicates a significant reduction from annual growth of 4.6% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 17% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - NantHealth is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that NantHealth's revenues are expected to grow slower than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on NantHealth, and their negativity could be grounds for caution.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for NantHealth going out as far as 2025, and you can see them 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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