It's been a sad week for CareCloud, Inc. (NASDAQ:CCLD), who've watched their investment drop 11% to US$1.47 in the week since the company reported its annual result. Revenues came in at US$111m, in line with forecasts and the company reported a statutory loss of US$0.28 per share, roughly in line with expectations. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Following last week's earnings report, CareCloud's five analysts are forecasting 2025 revenues to be US$112.4m, approximately in line with the last 12 months. CareCloud is also expected to turn profitable, with statutory earnings of US$0.11 per share. Before this latest report, the consensus had been expecting revenues of US$111.6m and US$0.21 per share in losses. Although we saw no serious change to the revenue outlook, the analysts have definitely increased their earnings estimates, estimating a profit next year, compared to previous forecasts of a loss. So it seems like the consensus has become substantially more bullish on CareCloud.

The average the analysts price target fell 15% to US$4.44, suggesting thatthe analysts have other concerns, and the improved earnings per share outlook was not enough to allay them. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values CareCloud at US$6.00 per share, while the most bearish prices it at US$1.50. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. 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 CareCloud's past performance and to peers in the same industry. It's pretty clear that there is an expectation that CareCloud's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.4% growth on an annualised basis. This is compared to a historical growth rate of 6.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that CareCloud is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that there's been a clear step-change in belief around the business' prospects, with the analysts now expecting CareCloud to become profitable 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 CareCloud's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for CareCloud going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for CareCloud you should know about.

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.