Some Analysts Just Cut Their Paratek Pharmaceuticals, Inc. (NASDAQ:PRTK) Estimates
The latest analyst coverage could presage a bad day for Paratek Pharmaceuticals, Inc. (NASDAQ:PRTK), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic. Surprisingly the share price has been buoyant, rising 18% to US$7.97 in the past 7 days. With such a sharp increase, it seems brokers may have seen something that is not yet being priced in by the wider market.
Following the downgrade, the current consensus from Paratek Pharmaceuticals' four analysts is for revenues of US$154m in 2021 which - if met - would reflect a major 287% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$176m in 2021. It looks like forecasts have become a fair bit less optimistic on Paratek Pharmaceuticals, given the substantial drop in revenue estimates.
See our latest analysis for Paratek Pharmaceuticals
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Paratek Pharmaceuticals' past performance and to peers in the same industry. The analysts are definitely expecting Paratek Pharmaceuticals' growth to accelerate, with the forecast 287% growth ranking favourably alongside historical growth of 48% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.9% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Paratek Pharmaceuticals is expected to grow much faster than its industry.
The Bottom Line
The clear low-light was that analysts slashing their revenue forecasts for Paratek Pharmaceuticals next year. They're also forecasting more rapid revenue growth than the wider market. Overall, given the drastic downgrade to next year's forecasts, we'd be feeling a little more wary of Paratek Pharmaceuticals going forwards.
There might be good reason for analyst bearishness towards Paratek Pharmaceuticals, like dilutive stock issuance over the past year. For more information, you can click here to discover this and the 2 other risks we've identified.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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