Industry Analysts Just Made A Dazzling Upgrade To Their Neuronetics, Inc. (NASDAQ:STIM) Revenue Forecasts

Shareholders in Neuronetics, Inc. (NASDAQ:STIM) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts have sharply increased their revenue numbers, with a view that Neuronetics will make substantially more sales than they'd previously expected.

After the upgrade, the three analysts covering Neuronetics are now predicting revenues of US$145m in 2025. If met, this would reflect a huge 99% improvement in sales compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.63. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$77m and losses of US$0.67 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

View our latest analysis for Neuronetics

It will come as no surprise to learn that the analysts have increased their price target for Neuronetics 25% to US$3.33 on the back of these upgrades.

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. The analysts are definitely expecting Neuronetics' growth to accelerate, with the forecast 74% annualised growth to the end of 2025 ranking favourably alongside historical growth of 6.2% per annum 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 7.8% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Neuronetics is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for next year, reflecting increased optimism around Neuronetics' prospects. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at Neuronetics.

Analysts are definitely bullish on Neuronetics, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including major dilution from new stock issuance in the past year. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.