Analysts just made a noticeable improvement to their forecast for Healthcare Realty Trust Incorporated (NYSE:HR)
Incorporated Health Care Real Estate Trust (NYSE:HR) Shareholders will have a reason to smile today as analysts deliver substantial improvements to this year’s statutory forecast. Consensus statutory figures for revenue and earnings per share (EPS) rose, with their view clearly much more bullish on the company’s business prospects.
After the upgrade, the three analysts covering Healthcare Realty Trust now forecast revenue of US$914 million in 2022. If achieved, it would reflect a major 63% improvement in sales over the past 12 months. Earnings per share are expected to jump 162% to US$0.45. Previously, analysts had modeled revenue of US$802 million and earnings per share (EPS) of US$0.41 in 2022. So we can see there’s been a pretty sharp uptick in analyst sentiment these lately, with revenue and earnings per share receiving a decent lift in the latest estimates.
Check out our latest analysis for Healthcare Realty Trust
Although analysts raised their earnings estimates, there was no change to the consensus price target of US$30.00, suggesting that the expected performance has no long-term impact. on the valuation of the company. The consensus price target is only an average of individual analyst targets, so it might be useful to see how wide the range of the underlying estimates is. There are some differing perceptions on Healthcare Realty Trust, with the most bullish analyst pricing it at US$33.00 and the most bearish at US$27.00 per share. This is a very narrow range of estimates, implying either that Healthcare Realty Trust is an easy company to value, or – more likely – that analysts rely heavily on certain key assumptions.
Looking at the big picture, one way to make sense of these forecasts is to see how they compare to both past performance and industry growth estimates. It is clear from the latest estimates that Healthcare Realty Trust’s growth rate is set to accelerate significantly, with forecast annualized revenue growth of 167% through the end of 2022 significantly faster than its historic growth of 5 .7% per year over the past five years. Compare that with other companies in the same industry, which are expected to grow revenue by 7.0% annually. Factoring in the expected revenue acceleration, it’s pretty clear that Healthcare Realty Trust is expected to grow much faster than its industry.
The most important thing to take away from this upgrade is that analysts have updated their earnings per share estimates for this year, expecting improved trading conditions. They also updated their revenue estimates for this year and sales are expected to grow faster than the broader market. The lack of change in the price target is puzzling, but with a serious improvement in this year’s earnings forecast, it might be time to take another look at Healthcare Realty Trust.
These earnings increases sound like a sterling endorsement, but before we dive in, know that we’ve spotted 4 potential issues with Healthcare Realty Trust, including major dilution from new share issues over the past year. You can find out more, and discover the other 2 concerns that we have identified, for free on our platform here.
Of course, see the management of the company invest large sums of money in a stock can be just as useful as knowing if analysts are updating their estimates. So you can also search this free list of stocks that insiders buy.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
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