U.S. Markets closed

What Are Analysts Saying About Agios Pharmaceuticals, Inc.'s (NASDAQ:AGIO) Earnings Outlook?

Simply Wall St

Agios Pharmaceuticals, Inc.'s (NASDAQ:AGIO) released its most recent earnings update in December 2018, which showed that losses became smaller relative to the prior year's level - great news for investors Below, I've laid out key numbers on how market analysts view Agios Pharmaceuticals's earnings growth outlook over the next couple of years and whether the future looks brighter. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.

See our latest analysis for Agios Pharmaceuticals

Market analysts' consensus outlook for the upcoming year seems pessimistic, with earnings becoming even more negative, generating -US$392.1m in 2020. Moreover, earnings are expected to fall off in the following year, declining to -US$374.7m in 2021 and -US$243.9m in 2022.

NasdaqGS:AGIO Past and Future Earnings, April 11th 2019

Although it’s informative understanding the growth rate each year relative to today’s figure, it may be more beneficial to determine the rate at which the business is moving on average every year. The pro of this technique is that we can get a better picture of the direction of Agios Pharmaceuticals's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I've inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 44%. This means, we can presume Agios Pharmaceuticals will grow its earnings by 44% every year for the next few years.

Next Steps:

For Agios Pharmaceuticals, there are three fundamental aspects you should further examine:

  1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
  2. Valuation: What is AGIO worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether AGIO is currently mispriced by the market.
  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of AGIO? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.