Sanara MedTech Inc. (NASDAQ:SMTI) Analysts Are Pretty Bullish On The Stock After Recent Results

Sanara MedTech Inc. (NASDAQ:SMTI) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues of US$46m arrived in line with expectations, although statutory losses per share were US$1.00, an impressive 21% smaller than what broker models predicted. Following the result, the analyst has 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 gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

Check out our latest analysis for Sanara MedTech

Taking into account the latest results, the consensus forecast from Sanara MedTech's single analyst is for revenues of US$73.5m in 2023, which would reflect a substantial 60% improvement in sales compared to the last 12 months. Per-share statutory losses are expected to explode, reaching US$0.58 per share. Before this earnings report, the analyst had been forecasting revenues of US$75.6m and earnings per share (EPS) of US$0.28 in 2023. The analyst have made an abrupt about-face on Sanara MedTech, administering a minor downgrade to to revenue forecasts and slashing the earnings outlook from a profit to loss.

The analyst lifted their price target 50% to US$60.00, implicitly signalling that lower earnings per share are not expected to have a longer-term impact on the stock's value.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Sanara MedTech's rate of growth is expected to accelerate meaningfully, with the forecast 60% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 37% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.6% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect Sanara MedTech to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst is expecting Sanara MedTech to become unprofitable next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Sanara MedTech that you need to be mindful 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.