Yahoo Finance Aclaris Therapeutics, Inc. (NASDAQ:ACRS) Reported Earnings Last Week And Analysts Are Already Upgrading Their Estimates
A week ago, Aclaris Therapeutics, Inc. (NASDAQ:ACRS) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. The results were impressive, with revenues of US$2.8m exceeding analyst forecasts by 52%, and statutory losses of US$0.15 were likewise much smaller than the analysts had forecast. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
View our latest analysis for Aclaris Therapeutics
Taking into account the latest results, the current consensus, from the nine analysts covering Aclaris Therapeutics, is for revenues of US$17.3m in 2024. This implies a sizeable 46% reduction in Aclaris Therapeutics' revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 23% to US$0.63. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$10.9m and losses of US$0.74 per share in 2024. 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.
The consensus price target fell 14%, to US$1.55, suggesting that the analysts remain pessimistic on the company, despite the improved earnings and revenue outlook. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Aclaris Therapeutics analyst has a price target of US$2.00 per share, while the most pessimistic values it at US$1.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 71% annualised decline to the end of 2024. That is a notable change from historical growth of 45% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 9.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Aclaris Therapeutics is expected to lag the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to 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 Aclaris Therapeutics' future valuation.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Aclaris Therapeutics going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Aclaris Therapeutics has 2 warning signs we think you should be aware of.
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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.
