This Analyst Just Made An Upgrade To Their Oscar Health, Inc. (NYSE:OSCR) Earnings Forecasts

Oscar Health, Inc. (NYSE:OSCR) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's statutory forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analyst modelling a real improvement in business performance. Investors have been pretty optimistic on Oscar Health too, with the stock up 35% to US$17.68 over the past week. Could this upgrade be enough to drive the stock even higher?

Following the upgrade, the latest consensus from Oscar Health's single analyst is for revenues of US$8.4b in 2024, which would reflect a huge 43% improvement in sales compared to the last 12 months. The losses are expected to disappear over the next year or so, with forecasts for a profit of US$0.04 per share this year. Yet before this consensus update, the analyst had been forecasting revenues of US$7.3b and losses of US$0.17 per share in 2024. It looks like there's been a definite improvement in business conditions, with a revenue upgrade supposed to lead to profitability sooner than previously forecast.

View our latest analysis for Oscar Health

With these upgrades, we're not surprised to see that the analyst has lifted their price target 60% to US$16.00 per share.

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. We would highlight that Oscar Health's revenue growth is expected to slow, with the forecast 43% annualised growth rate until the end of 2024 being well below the historical 63% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.8% annually. So it's pretty clear that, while Oscar Health's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away from this upgrade is that there is now an expectation for Oscar Health to become profitable this year, compared to previous expectations of a loss. Fortunately, the analyst also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Oscar Health could be worth investigating further.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Oscar Health going out as far as 2025, and you can see them 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 that insiders are buying.

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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.