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One Analyst's Revenue Estimates For Healthia Limited (ASX:HLA) Are Surging Higher

Simply Wall St
·3 min read

Healthia Limited (ASX:HLA) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's forecasts. The revenue forecast for this year has experienced a facelift, with the analyst now much more optimistic on its sales pipeline. The market may be pricing in some blue sky too, with the share price gaining 14% to AU$1.19 in the last 7 days. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

After this upgrade, Healthia's solo analyst is now forecasting revenues of AU$135m in 2021. This would be a substantial 55% improvement in sales compared to the last 12 months. Before the latest update, the analyst was foreseeing AU$112m of revenue in 2021. It looks like there's been a clear increase in optimism around Healthia, given the chunky increase in revenue forecasts.

Check out our latest analysis for Healthia


Additionally, the consensus price target for Healthia increased 13% to AU$1.70, showing a clear increase in optimism from the analyst involved.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Healthia's rate of growth is expected to accelerate meaningfully, with the forecast 55% revenue growth noticeably faster than its historical growth of 21% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.1% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Healthia is expected to grow much faster than its industry.

The Bottom Line

The highlight for us was that the analyst increased their revenue forecasts for Healthia this year. They're also forecasting more rapid revenue growth than the wider market. There was also a nice increase in the price target, with the analyst apparently feeling that the intrinsic value of the business is improving. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Healthia.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 5 potential concerns with Healthia, including dilutive stock issuance over the past year. For more information, you can click through to our platform to learn more about this and the 4 other concerns we've identified .

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.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.