Analysts Have Just Cut Their Nano-X Imaging Ltd. (NASDAQ:NNOX) Revenue Estimates By 39%

One thing we could say about the analysts on Nano-X Imaging Ltd. (NASDAQ:NNOX) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

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After the downgrade, the four analysts covering Nano-X Imaging are now predicting revenues of US$14m in 2025. If met, this would reflect a solid 20% improvement in sales compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.79. Yet before this consensus update, the analysts had been forecasting revenues of US$23m and losses of US$0.73 per share in 2025. Ergo, there's been a clear change in sentiment, with the analysts 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 Nano-X Imaging

The consensus price target fell 17% to US$9.75, implicitly signalling that lower earnings per share are a leading indicator for Nano-X Imaging's valuation.

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. It's pretty clear that there is an expectation that Nano-X Imaging's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 27% growth on an annualised basis. This is compared to a historical growth rate of 52% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.7% annually. So it's pretty clear that, while Nano-X Imaging's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of Nano-X Imaging going forwards.

Still, 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 Nano-X Imaging going out to 2027, and you can see them 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.