CONMED Corporation (NYSE:CNMD) Just Reported Earnings, And Analysts Cut Their Target Price
There's been a notable change in appetite for CONMED Corporation (NYSE:CNMD) shares in the week since its annual report, with the stock down 12% to US$80.91. It looks like the results were a bit of a negative overall. While revenues of US$1.2b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.6% to hit US$2.04 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on CONMED after the latest results.
See our latest analysis for CONMED
Taking into account the latest results, the most recent consensus for CONMED from eight analysts is for revenues of US$1.35b in 2024. If met, it would imply a decent 8.4% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 64% to US$3.43. In the lead-up to this report, the analysts had been modelling revenues of US$1.36b and earnings per share (EPS) of US$3.54 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
The average price target fell 9.9% to US$111, with reduced earnings forecasts clearly tied to a lower valuation estimate. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values CONMED at US$132 per share, while the most bearish prices it at US$98.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that CONMED's rate of growth is expected to accelerate meaningfully, with the forecast 8.4% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.4% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 8.0% per year. CONMED is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for CONMED. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for CONMED going out to 2026, and you can see them free on our platform here..
You still need to take note of risks, for example - CONMED has 1 warning sign we think you should be aware 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.
