Celebrations may be in order for DocGo Inc. (NASDAQ:DCGO) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts have sharply increased their revenue numbers, with a view that DocGo will make substantially more sales than they'd previously expected.
Following the upgrade, the latest consensus from DocGo's seven analysts is for revenues of US$765m in 2024, which would reflect a sizeable 43% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to bounce 457% to US$0.39. Before this latest update, the analysts had been forecasting revenues of US$685m and earnings per share (EPS) of US$0.36 in 2024. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.
View our latest analysis for DocGo
Although the analysts have upgraded their earnings estimates, there was no change to the consensus price target of د.إ46.70, suggesting that the forecast performance does not have a long term impact on the company's valuation. 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. There are some variant perceptions on DocGo, with the most bullish analyst valuing it at د.إ58.77 and the most bearish at د.إ36.73 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await DocGo shareholders.
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 pretty clear that there is an expectation that DocGo's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 33% growth on an annualised basis. This is compared to a historical growth rate of 46% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.9% per year. Even after the forecast slowdown in growth, it seems obvious that DocGo is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for next year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at DocGo.
Analysts are clearly in love with DocGo at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as concerns around earnings quality. For more information, you can click through to our platform to learn more about this and the 3 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.