CareDx, Inc (NASDAQ:CDNA) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. Investors have been pretty optimistic on CareDx too, with the stock up 22% to US$22.88 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the most recent consensus for CareDx from its seven analysts is for revenues of US$325m in 2024 which, if met, would be a solid 9.5% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 73% to US$0.81 per share. However, before this estimates update, the consensus had been expecting revenues of US$279m and US$1.42 per share in losses. We can see there's definitely been a change in sentiment in this update, with the analysts administering a sizeable upgrade to this year's revenue estimates, while at the same time reducing their loss estimates.

View our latest analysis for CareDx

The consensus price target rose 52% to US$29.25, with the analysts encouraged by the higher revenue and lower forecast losses for this year.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 20% growth on an annualised basis. That is in line with its 18% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 18% per year. It's clear that while CareDx's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting CareDx is moving incrementally towards profitability. They also upgraded their revenue forecasts, although the latest estimates suggest that CareDx will grow in line with the overall market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at CareDx.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple CareDx analysts - going out to 2026, and you can see them free on our platform here.

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