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One thing we could say about the analysts on Dynatronics Corporation (NASDAQ:DYNT) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.
Following the latest downgrade, the dual analysts covering Dynatronics provided consensus estimates of US$36m revenue in 2024, which would reflect a not inconsiderable 16% decline on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 85% to US$0.18. Yet before this consensus update, the analysts had been forecasting revenues of US$49m and losses of US$0.28 per share in 2024. We can see there's definitely been a change in sentiment in this update, with the analysts administering a meaningful downgrade to next year's revenue estimates, while at the same time reducing their loss estimates.
See our latest analysis for Dynatronics
The consensus price target fell 19% to US$10.83, with the dip in revenue estimates clearly souring analyst sentiment, despite the forecast reduction in losses. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Dynatronics at US$20.00 per share, while the most bearish prices it at US$6.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.
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. One more thing stood out to us about these estimates, and it's the idea that Dynatronics' decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 13% to the end of 2024. This tops off a historical decline of 9.8% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 8.3% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Dynatronics to suffer worse than the wider industry.