RxSight, Inc. (NASDAQ:RXST) Just Reported And Analysts Have Been Lifting Their Price Targets

RxSight, Inc. (NASDAQ:RXST) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Results overall were credible, with revenues arriving 7.7% better than analyst forecasts at US$11m. Higher revenues also resulted in lower statutory losses, which were US$0.61 per share, some 7.7% smaller than the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for RxSight

Following the latest results, RxSight's four analysts are now forecasting revenues of US$45.2m in 2022. This would be a substantial 31% improvement in sales compared to the last 12 months. Losses are forecast to balloon 20% to US$2.73 per share. Before this latest report, the consensus had been expecting revenues of US$43.7m and US$2.77 per share in losses.

The consensus price target rose 6.4% to US$20.75, with the analysts encouraged by the improved revenue outlook even though the company remains lossmaking. 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 RxSight at US$24.00 per share, while the most bearish prices it at US$17.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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 RxSight's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 72% growth on an annualised basis. This is compared to a historical growth rate of 98% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.9% annually. Even after the forecast slowdown in growth, it seems obvious that RxSight is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for RxSight going out to 2024, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for RxSight you should be aware of.

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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.