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Last week, you might have seen that Pro Medicus Limited (ASX:PME) released its half-yearly result to the market. The early response was not positive, with shares down 3.1% to AU$279 in the past week. Results overall were respectable, with statutory earnings of AU$0.49 per share roughly in line with what the analysts had forecast. Revenues of AU$97m came in 3.9% ahead of analyst predictions. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Pro Medicus after the latest results.
Check out our latest analysis for Pro Medicus
Following the latest results, Pro Medicus' 13 analysts are now forecasting revenues of AU$215.8m in 2025. This would be a decent 16% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to ascend 17% to AU$1.10. In the lead-up to this report, the analysts had been modelling revenues of AU$214.6m and earnings per share (EPS) of AU$1.07 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target rose 15% to AU$253, suggesting that higher earnings estimates flow through to the stock's valuation as well. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Pro Medicus analyst has a price target of AU$330 per share, while the most pessimistic values it at AU$46.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Pro Medicus' growth to accelerate, with the forecast 35% annualised growth to the end of 2025 ranking favourably alongside historical growth of 26% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 22% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Pro Medicus is expected to grow much faster than its industry.