Last week, you might have seen that Next Science Limited (ASX:NXS) released its yearly result to the market. The early response was not positive, with shares down 6.1% to AU$0.69 in the past week. Revenues of US$12m beat expectations by a respectable 3.7%, although statutory losses per share increased. Next Science lost US$0.06, which was 35% 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.

See our latest analysis for Next Science

Taking into account the latest results, the consensus forecast from Next Science's two analysts is for revenues of US$19.8m in 2023, which would reflect a sizeable 69% improvement in sales compared to the last 12 months. Statutory losses are forecast to balloon 77% to US$0.014 per share. In the lead-up to this report, the analysts had been modelling revenues of US$19.6m and earnings per share (EPS) of US$0.019 in 2023. 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.

The consensus price target fell 40% to AU$0.80per share, with the analysts clearly concerned by ballooning losses.

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. The analysts are definitely expecting Next Science's growth to accelerate, with the forecast 69% annualised growth to the end of 2023 ranking favourably alongside historical growth of 31% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Next Science to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts are expecting Next Science to become unprofitable next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Next Science. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Next Science going out as far as 2025, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for Next Science (1 is a bit concerning!) that you need to take into consideration.

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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.

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