Yahoo Finance SomaLogic, Inc. (NASDAQ:SLGC) Just Reported Earnings, And Analysts Cut Their Target Price
SomaLogic, Inc. (NASDAQ:SLGC) just released its quarterly report and things are looking bullish. Revenues and losses per share were both better than expected, with revenues of US$20m leading estimates by 3.2%. Statutory losses were smaller than the analystsexpected, coming in at US$0.13 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
See our latest analysis for SomaLogic
Taking into account the latest results, the four analysts covering SomaLogic provided consensus estimates of US$82.0m revenue in 2023, which would reflect a definite 19% decline over the past 12 months. Losses are supposed to decline, shrinking 11% from last year to US$0.67. Before this earnings announcement, the analysts had been modelling revenues of US$81.6m and losses of US$0.64 per share in 2023. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although revenue forecasts held steady, the consensus also made a pronounced increase to its losses per share forecasts.
The consensus price target fell 13% to US$5.63per share, with the analysts clearly concerned by ballooning losses. 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 SomaLogic, with the most bullish analyst valuing it at US$7.00 and the most bearish at US$3.50 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 35% by the end of 2023. This indicates a significant reduction from annual growth of 27% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.2% annually for the foreseeable future. It's pretty clear that SomaLogic's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at SomaLogic. 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 SomaLogic's future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on SomaLogic. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for SomaLogic going out to 2025, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with SomaLogic , and understanding them should be part of your investment process.
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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.
