ATI Physical Therapy, Inc. (NYSE:ATIP) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

ATI Physical Therapy, Inc. (NYSE:ATIP) shareholders are probably feeling a little disappointed, since its shares fell 3.3% to US$6.14 in the week after its latest second-quarter results. Revenues of US$188m arrived in line with expectations, although statutory losses per share were US$0.86, an impressive 67% smaller than what broker models predicted. Following the result, the analysts have 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 estimates suggest is in store for next year.

View our latest analysis for ATI Physical Therapy

Taking into account the latest results, the current consensus from ATI Physical Therapy's dual analysts is for revenues of US$748.7m in 2024. This would reflect a reasonable 4.4% increase on its revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 25% to US$9.70. Before this earnings announcement, the analysts had been modelling revenues of US$750.7m and losses of US$12.37 per share in 2024. Although the revenue estimates have not really changed ATI Physical Therapy'sfuture looks a little different to the past, with a considerable decrease in the loss per share forecasts in particular.

The average price target held steady at US$5.50, seeming to indicate that business is performing in line with expectations.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the ATI Physical Therapy's past performance and to peers in the same industry. It's clear from the latest estimates that ATI Physical Therapy's rate of growth is expected to accelerate meaningfully, with the forecast 9.0% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 5.9% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.8% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ATI Physical Therapy 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, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. 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. At least one analyst has provided forecasts out to 2025, 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 4 warning signs for ATI Physical Therapy 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.