As you might know, Alimera Sciences, Inc. (NASDAQ:ALIM) recently reported its yearly numbers. Sales of US$54m came in 4.6% ahead of expectations, although statutory earnings didn't fare nearly so well, recording a loss of US$2.19, a 20% miss. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see analysts' latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for Alimera Sciences from three analysts is for revenues of US$60.6m in 2020, which is a meaningful 12% increase on its sales over the past 12 months. Statutory losses are forecast to balloon 58% to US$0.91 per share. Before this latest report, the consensus had been expecting revenues of US$59.2m and US$1.51 per share in losses. There's been a pretty noticeable increase in sentiment, with analysts upgrading revenues and making a considerable lift to earnings per share in particular
Yet despite these upgrades, analysts cut their price target 15% to US$21.63, implicitly signalling that the ongoing losses are likely to weigh negatively on Alimera Sciences's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Alimera Sciences analyst has a price target of US$25.00 per share, while the most pessimistic values it at US$15.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Alimera Sciences's past performance and to peers in the same market. It's pretty clear that analysts expect Alimera Sciences's revenue growth will slow down substantially, with revenues next year expected to grow 12%, compared to a historical growth rate of 26% over the past five years. Juxtapose this against the other companies in the market with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.1% next year. So it's pretty clear that, while Alimera Sciences's revenue growth is expected to slow, it's still expected to grow faster than the market itself.
The Bottom Line
The most important thing to note from these estimates is that the consensus increased its forecast losses next year, suggesting all may not be well at Alimera Sciences. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by the latest results, leading to a lower estimate of Alimera Sciences's future valuation.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Alimera Sciences analysts - going out to 2022, and you can see them free on our platform here.
You can also view our analysis of Alimera Sciences's balance sheet, and whether we think Alimera Sciences is carrying too much debt, for free on our platform here.
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