Analysts Have Been Trimming Their CM Hospitalar S/A (BVMF:VVEO3) Price Target After Its Latest Report

CM Hospitalar S/A (BVMF:VVEO3) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues of R$2.9b were in line with expectations, although statutory losses per share were R$0.11, some 16% smaller than was expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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After the latest results, the five analysts covering CM Hospitalar S/A are now predicting revenues of R$12.0b in 2026. If met, this would reflect a credible 2.1% improvement in revenue compared to the last 12 months. Earnings are expected to tip over into lossmaking territory, with the analysts forecasting statutory losses of -R$0.25 per share in 2026. Before this earnings announcement, the analysts had been modelling revenues of R$11.9b and losses of R$0.081 per share in 2026. So it's pretty clear the analysts have mixed opinions on CM Hospitalar S/A even after this update; although they reconfirmed their revenue numbers, it came at the cost of a very substantial increase in per-share losses.

Check out our latest analysis for CM Hospitalar S/A

The consensus price target fell 12% to R$1.22per share, with the analysts clearly concerned by ballooning losses. 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. Currently, the most bullish analyst values CM Hospitalar S/A at R$2.00 per share, while the most bearish prices it at R$0.70. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the CM Hospitalar S/A's past performance and to peers in the same industry. We would highlight that CM Hospitalar S/A's revenue growth is expected to slow, with the forecast 4.2% annualised growth rate until the end of 2026 being well below the historical 13% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 13% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than CM Hospitalar S/A.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of CM Hospitalar S/A's future valuation.

With that in mind, we wouldn't be too quick to come to a conclusion on CM Hospitalar S/A. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple CM Hospitalar S/A analysts - going out to 2028, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for CM Hospitalar S/A (of which 2 are concerning!) 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.