Earnings Beat: OraSure Technologies, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

It's been a good week for OraSure Technologies, Inc. (NASDAQ:OSUR) shareholders, because the company has just released its latest full-year results, and the shares gained 7.2% to US$7.20. Revenues were US$405m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.72, an impressive 33% ahead of estimates. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 OraSure Technologies

After the latest results, the consensus from OraSure Technologies' six analysts is for revenues of US$191.4m in 2024, which would reflect a stressful 53% decline in revenue compared to the last year of performance. Earnings are expected to tip over into lossmaking territory, with the analysts forecasting statutory losses of -US$0.19 per share in 2024. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$205.3m and losses of US$0.27 per share in 2024. While the revenue estimates fell, sentiment seems to have improved, with the analysts making a very favorable reduction to losses per share in particular.

There was no major change to the US$7.65average price target, suggesting that the adjustments to revenue and earnings are not expected to have a long-term impact on the business. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values OraSure Technologies at US$9.00 per share, while the most bearish prices it at US$7.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting OraSure Technologies is an easy business to forecast or the the analysts are all using similar assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the OraSure Technologies' past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 53% by the end of 2024. This indicates a significant reduction from annual growth of 26% 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 7.8% annually for the foreseeable future. It's pretty clear that OraSure Technologies' revenues are expected to perform substantially worse 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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Even so, long term profitability is more important for the value creation process. 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for OraSure Technologies going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 2 warning signs for OraSure Technologies (1 is significant!) that you need to take into consideration.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.