It's been a good week for RadNet, Inc. (NASDAQ:RDNT) shareholders, because the company has just released its latest quarterly results, and the shares gained 9.8% to US$60.34. Revenues of US$471m beat expectations by a respectable 6.4%, although statutory losses per share increased. RadNet lost US$0.50, which was 257% more than what the analysts had included in their models. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Following the latest results, RadNet's four analysts are now forecasting revenues of US$1.96b in 2025. This would be a satisfactory 5.1% improvement in revenue compared to the last 12 months. Per-share statutory losses are expected to explode, reaching US$0.045 per share. Before this earnings report, the analysts had been forecasting revenues of US$1.93b and earnings per share (EPS) of US$0.30 in 2025. While the analysts have made no real change to their revenue estimates, we can see that the consensus is now modelling a loss next year - a clear dip in sentiment compared to the previous outlook of a profit.

See our latest analysis for RadNet

The consensus price target held steady at US$72.00, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. 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 RadNet at US$80.00 per share, while the most bearish prices it at US$60.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting RadNet is an easy business to forecast or the the analysts are all using similar assumptions.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the RadNet's past performance and to peers in the same industry. It's pretty clear that there is an expectation that RadNet's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 6.8% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.9% annually. So it's pretty clear that, while RadNet's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

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The Bottom Line

The biggest low-light for us was that the forecasts for RadNet dropped from profits to a loss next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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. We have estimates - from multiple RadNet analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that  RadNet is showing  1 warning sign in our investment analysis, 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.