Nephros, Inc. (NASDAQ:NEPH) shareholders are probably feeling a little disappointed, since its shares fell 4.1% to US$2.10 in the week after its latest quarterly results. Revenues of US$3.5m came in a modest 5.7% below forecasts. Statutory losses were a relative bright spot though, with a per-share loss of US$0.02 coming in a substantial 50% smaller than what the analyst had expected. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.

See our latest analysis for Nephros

Taking into account the latest results, the consensus forecast from Nephros' lone analyst is for revenues of US$15.7m in 2024. This reflects a decent 12% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 63% to US$0.05. Before this latest report, the consensus had been expecting revenues of US$16.7m and US$0.04 per share in losses. While this year's revenue estimates dropped there was also a very substantial increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

The average price target lifted 58% to US$4.75, clearly signalling that the weaker revenue and EPS outlook are not expected to weigh on the stock over the longer term.

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 analyst is definitely expecting Nephros' growth to accelerate, with the forecast 16% annualised growth to the end of 2024 ranking favourably alongside historical growth of 10% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect Nephros to grow faster than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Nephros. They also downgraded Nephros' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Nephros you should know about.

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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.