Yahoo Finance EDAP TMS S.A. (NASDAQ:EDAP) Just Reported Earnings, And Analysts Cut Their Target Price
EDAP TMS S.A. (NASDAQ:EDAP) last week reported its latest yearly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. The results don't look great, especially considering that statutory losses grew 20% to€0.56 per share. Revenues of €60,423,000 did beat expectations by 4.9%, but it looks like a bit of a cold comfort. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Check out our latest analysis for EDAP TMS
After the latest results, the three analysts covering EDAP TMS are now predicting revenues of €67.8m in 2024. If met, this would reflect a decent 12% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 60% to €0.23. Before this earnings announcement, the analysts had been modelling revenues of €65.4m and losses of €0.26 per share in 2024. So it seems there's been a definite increase in optimism about EDAP TMS' future following the latest consensus numbers, with a notable improvement in the loss per share forecasts in particular.
The consensus price target fell 18%, to US$12.33, suggesting that the analysts remain pessimistic on the company, despite the improved earnings and revenue outlook. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on EDAP TMS, with the most bullish analyst valuing it at US$16.00 and the most bearish at US$9.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the EDAP TMS' past performance and to peers in the same industry. It's clear from the latest estimates that EDAP TMS' rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 8.0% 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 7.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect EDAP TMS 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, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of EDAP TMS' future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on EDAP TMS. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple EDAP TMS analysts - going out to 2026, and you can see them free on our platform here.
Even so, be aware that EDAP TMS is showing 1 warning sign in our investment analysis , you should know about...
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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.
