Wave Life Sciences Ltd.'s (NASDAQ:WVE) latest earnings announcement in December 2018 indicated 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 perceive Wave Life Sciences's earnings growth outlook over the next few years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
Analysts' outlook for the upcoming year seems relatively muted, with earnings continuing to flop around in the negative territory, reaching -US$134.7m in 2020. However, earnings are predicted to move into an upward direction, reaching -US$189.0m in 2021, before plateauing down to -US$171.8m in 2022.
While it’s useful to understand the rate of growth each year relative to today’s level, it may be more valuable analyzing the rate at which the business is rising or falling every year, on average. The advantage of this method is that it removes the impact of near term flucuations and accounts for the overarching direction of Wave Life Sciences's earnings trajectory over time, be more volatile. To compute this rate, I've appended a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 25%. This means, we can expect Wave Life Sciences will grow its earnings by 25% every year for the next couple of years.
For Wave Life Sciences, I've put together three fundamental aspects you should further examine:
- 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.
- Future Earnings: How does WVE's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart.
- Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of WVE? 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 firstname.lastname@example.org. 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.