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Rockwell Medical, Inc. (NASDAQ:RMTI) missed earnings with its latest second-quarter results, disappointing overly-optimistic forecasters. Earnings fell badly short of analyst estimates, with US$15m revenue falling -17% short, and statutory losses of US$0.09 per share being -12% greater than forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the most recent consensus for Rockwell Medical from two analysts is for revenues of US$71.5m in 2021 which, if met, would be a solid 17% increase on its sales over the past 12 months. Losses are expected to be contained, narrowing 12% from last year to US$0.32. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$77.0m and losses of US$0.32 per share in 2021.
The average price target fell 25% to US$5.25, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing losses.
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. The analysts are definitely expecting Rockwell Medical's growth to accelerate, with the forecast 37% annualised growth to the end of 2021 ranking favourably alongside historical growth of 3.3% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 8.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Rockwell Medical is expected to grow much faster than its industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also downgraded their revenue estimates, although industry data suggests that Rockwell Medical's revenues are expected 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 Rockwell Medical's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Rockwell Medical that you should be aware of.
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.
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