Need To Know: Analysts Are Much More Bullish On Meridian Bioscience, Inc. (NASDAQ:VIVO) Revenues

Celebrations may be in order for Meridian Bioscience, Inc. (NASDAQ:VIVO) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 24% to US$28.77 in the last 7 days. Could this upgrade be enough to drive the stock even higher?

Following the upgrade, the most recent consensus for Meridian Bioscience from its two analysts is for revenues of US$336m in 2021 which, if met, would be a meaningful 12% increase on its sales over the past 12 months. Per-share earnings are expected to accumulate 9.9% to US$1.80. Prior to this update, the analysts had been forecasting revenues of US$305m and earnings per share (EPS) of US$1.22 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Meridian Bioscience

It will come as no surprise to learn that the analysts have increased their price target for Meridian Bioscience 47% to US$34.00 on the back of these upgrades. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Meridian Bioscience at US$30.00 per share, while the most bearish prices it at US$26.00. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Meridian Bioscience's past performance and to peers in the same industry. It's clear from the latest estimates that Meridian Bioscience's rate of growth is expected to accelerate meaningfully, with the forecast 12% revenue growth noticeably faster than its historical growth of 5.2% 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 9.0% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Meridian Bioscience to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Meridian Bioscience.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At least one analyst has provided forecasts out to 2022, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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