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Syneos Health, Inc. Beat Analyst Estimates: See What The Consensus Is Forecasting For Next Year

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Simply Wall St
·4 min read
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Syneos Health, Inc. (NASDAQ:SYNH) shareholders are probably feeling a little disappointed, since its shares fell 8.4% to US$53.08 in the week after its latest third-quarter results. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$1.1b, statutory earnings beat expectations by a notable 46%, coming in at US$0.60 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Syneos Health

earnings-and-revenue-growth
earnings-and-revenue-growth

Following the latest results, Syneos Health's twelve analysts are now forecasting revenues of US$5.08b in 2021. This would be a meaningful 13% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 27% to US$2.34. In the lead-up to this report, the analysts had been modelling revenues of US$5.00b and earnings per share (EPS) of US$2.22 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$73.23, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Syneos Health at US$84.00 per share, while the most bearish prices it at US$50.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Syneos Health's revenue growth will slow down substantially, with revenues next year expected to grow 13%, compared to a historical growth rate of 37% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.1% next year. So it's pretty clear that, while Syneos Health's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Syneos Health following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$73.23, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Syneos Health going out to 2024, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 2 warning signs for Syneos Health (of which 1 is a bit concerning!) you should know about.

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.