Yahoo Finance Analysts Are Betting On Immunomedics, Inc. (NASDAQ:IMMU) With A Big Upgrade This Week
Shareholders in Immunomedics, Inc. (NASDAQ:IMMU) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 30% to US$28.33 in the last 7 days. Could this upgrade be enough to drive the stock even higher?
Following the upgrade, the current consensus from Immunomedics' eleven analysts is for revenues of US$72m in 2020 which - if met - would reflect a huge increase on its sales over the past 12 months. Losses are presumed to reduce, shrinking 16% from last year to US$1.55. Yet before this consensus update, the analysts had been forecasting revenues of US$52m and losses of US$1.61 per share in 2020. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.
See our latest analysis for Immunomedics
It will come as no surprise to learn that the analysts have increased their price target for Immunomedics 30% to US$35.90 on the back of these upgrades. 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. There are some variant perceptions on Immunomedics, with the most bullish analyst valuing it at US$60.00 and the most bearish at US$22.00 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.
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. One thing stands out from these estimates, which is that Immunomedics is forecast to grow faster in the future than it has in the past, with revenues expected to grow manyfold. If achieved, this would be a much better result than the 41% annual decline over the past five years. Compare this against analyst estimates for the wider industry, which suggest that (in aggregate) industry revenues are expected to grow 17% next year. So it looks like Immunomedics is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Immunomedics'prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Immunomedics.
These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 4 potential concerns with Immunomedics, including dilutive stock issuance over the past year. You can learn more, and discover the 3 other concerns we've identified, for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
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