Akebia Therapeutics, Inc. (NASDAQ:AKBA) Released Earnings Last Week And Analysts Lifted Their Price Target To US$4.33
It's been a pretty great week for Akebia Therapeutics, Inc. (NASDAQ:AKBA) shareholders, with its shares surging 16% to US$1.70 in the week since its latest yearly results. Revenues of US$195m were in line with expectations, although statutory losses per share were US$0.28, some 12% smaller than was expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Akebia Therapeutics after the latest results.
View our latest analysis for Akebia Therapeutics
Following last week's earnings report, Akebia Therapeutics' three analysts are forecasting 2024 revenues to be US$193.1m, approximately in line with the last 12 months. Per-share losses are predicted to creep up to US$0.27. Before this latest report, the consensus had been expecting revenues of US$192.7m and US$0.28 per share in losses. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.
These new estimates led to the consensus price target rising 12% to US$4.33, with lower forecast losses suggesting things could be looking up for Akebia Therapeutics. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Akebia Therapeutics analyst has a price target of US$5.00 per share, while the most pessimistic values it at US$4.00. This is a very narrow spread of estimates, implying either that Akebia Therapeutics is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2024 compared to the historical decline of 5.4% per annum over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 18% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Akebia Therapeutics to suffer worse than 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, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Akebia Therapeutics' revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Akebia Therapeutics 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 4 warning signs for Akebia Therapeutics (of which 1 is significant!) you should know about.
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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.
