Shareholders will be ecstatic, with their stake up 44% over the past week following GoHealth, Inc.'s (NASDAQ:GOCO) latest quarterly results. Results look to have been somewhat negative - revenue fell 5.7% short of analyst estimates at US$183m, although statutory losses were somewhat better. The per-share loss was US$1.12, 36% smaller than the analysts were expecting prior to the result. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for GoHealth

Following the latest results, GoHealth's four analysts are now forecasting revenues of US$785.3m in 2023. This would be a huge 44% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 77% to US$3.74. Before this earnings announcement, the analysts had been modelling revenues of US$784.7m and losses of US$5.19 per share in 2023. Although the revenue estimates have not really changed GoHealth'sfuture looks a little different to the past, with a very favorable reduction to the loss per share forecasts in particular.

There's been no major changes to the consensus price target of US$11.17, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on GoHealth, with the most bullish analyst valuing it at US$14.00 and the most bearish at US$8.50 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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 clear from the latest estimates that GoHealth's rate of growth is expected to accelerate meaningfully, with the forecast 63% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 4.2% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.9% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that GoHealth is expected to grow much faster than its industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple GoHealth analysts - going out to 2024, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for GoHealth (1 shouldn't be ignored!) that you need to be mindful of.

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.

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