As you might know, Amyris, Inc. (NASDAQ:AMRS) last week released its latest quarterly, and things did not turn out so great for shareholders. It was not a great result overall, as revenues of US$65m fell 20% short of analyst expectations. Unsurprisingly, statutory losses ended up being17% larger than the analysts expected, at US$0.34 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the most recent consensus for Amyris from eight analysts is for revenues of US$350.2m in 2022 which, if met, would be a huge 49% increase on its sales over the past 12 months. Per-share losses are supposed to see a sharp uptick, reaching US$0.77. Before this earnings announcement, the analysts had been modelling revenues of US$363.1m and losses of US$0.85 per share in 2022. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for this year.
The consensus price target fell 7.3% to US$10.91, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. 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. There are some variant perceptions on Amyris, with the most bullish analyst valuing it at US$22.00 and the most bearish at US$2.00 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 analysts think this business will perform. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Amyris' past performance and to peers in the same industry. It's clear from the latest estimates that Amyris' rate of growth is expected to accelerate meaningfully, with the forecast 121% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 28% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Amyris is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also downgraded their revenue estimates, although industry data suggests that Amyris' revenues are expected to grow faster than the wider industry. Still, earnings per share are more important to value creation for shareholders. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Amyris' 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 estimates - from multiple Amyris analysts - going out to 2024, and you can see them free on our platform here.
Before you take the next step you should know about the 5 warning signs for Amyris (3 are significant!) that we have uncovered.
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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.
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