Downgrade: Here's How Analysts See Cutera, Inc. (NASDAQ:CUTR) Performing In The Near Term
Market forces rained on the parade of Cutera, Inc. (NASDAQ:CUTR) shareholders today, when the analysts downgraded their forecasts for next year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.
After the downgrade, the consensus from Cutera's four analysts is for revenues of US$173m in 2024, which would reflect a sizeable 25% decline in sales compared to the last year of performance. Losses are predicted to fall substantially, shrinking 42% to US$3.29 per share. However, before this estimates update, the consensus had been expecting revenues of US$195m and US$2.85 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.
See our latest analysis for Cutera
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 20% by the end of 2024. This indicates a significant reduction from annual growth of 11% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 7.9% per year. It's pretty clear that Cutera's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to note from this downgrade is that the consensus increased its forecast losses next year, suggesting all may not be well at Cutera. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Cutera's revenues are expected to grow slower than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Cutera, and their negativity could be grounds for caution.
That said, the analysts might have good reason to be negative on Cutera, given a short cash runway. Learn more, and discover the 2 other warning signs we've identified, 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 downgrading their estimates. So you may also wish to search this free list of stocks 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.
