Genocea Biosciences Inc’s (NASDAQ:GNCA) most recent earnings update in September 2017 revealed company earnings became less negative compared to the previous year’s level as a result of recent tailwinds Below is my commentary, albeit very simple and high-level, on how market analysts view Genocea Biosciences’s earnings growth outlook over the next few years and whether the future looks brighter. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings. See our latest analysis for Genocea Biosciences
Market analysts’ consensus outlook for this coming year seems buoyant, with earnings becoming less negative, generating $-43.6M in 2019. Additionally, earnings are expected to continue its upward trend, generating $-32.4M in 2020, before plateauing down to $-35.6M in 2021.
Even though it’s useful to understand the growth year by year relative to today’s value, it may be more insightful evaluating the rate at which the business is moving on average every year. The benefit of this method is that we can get a better picture of the direction of Genocea Biosciences’s earnings trajectory over the long run, irrespective of near term fluctuations, be more volatile. To compute this rate, I’ve inserted 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 2.75%. This means, we can anticipate Genocea Biosciences will grow its earnings by 2.75% every year for the next few years.
For Genocea Biosciences, 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. Future Earnings: How does GNCA’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.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of GNCA? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.