Arcutis Biotherapeutics, Inc. (NASDAQ:ARQT) Just Reported, And Analysts Assigned A US$41.57 Price Target
Arcutis Biotherapeutics, Inc. (NASDAQ:ARQT) just released its latest quarterly results and things are looking bullish. Revenues were better than expected, with US$5.2m in revenue some 12% ahead of forecasts. The company still lost US$1.16 per share, although the losses were marginally smaller than the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for Arcutis Biotherapeutics
After the latest results, the seven analysts covering Arcutis Biotherapeutics are now predicting revenues of US$28.0m in 2023. If met, this would reflect a huge 149% improvement in revenue compared to the last 12 months. Losses are forecast to narrow 8.9% to US$4.89 per share. Before this earnings announcement, the analysts had been modelling revenues of US$29.1m and losses of US$4.95 per share in 2023.
The average price target fell 5.8% to US$41.57, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing losses. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Arcutis Biotherapeutics, with the most bullish analyst valuing it at US$57.00 and the most bearish at US$22.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Arcutis Biotherapeutics' growth to accelerate, with the forecast 5x annualised growth to the end of 2023 ranking favourably alongside historical growth of 151% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Arcutis Biotherapeutics to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also downgraded Arcutis Biotherapeutics' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Arcutis Biotherapeutics' future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Arcutis Biotherapeutics going out to 2025, and you can see them free on our platform here..
You should always think about risks though. Case in point, we've spotted 4 warning signs for Arcutis Biotherapeutics you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
