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Aspen Aerogels, Inc. (NYSE:ASPN) Analysts Are Cutting Their Estimates: Here's What You Need To Know

Simply Wall St
·3 min read

As you might know, Aspen Aerogels, Inc. (NYSE:ASPN) last week released its latest quarterly, and things did not turn out so great for shareholders. Revenues missed expectations somewhat, coming in at US$24m, but statutory earnings fell catastrophically short, with a loss of US$0.25 some 53% larger than what the analysts had predicted. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Aspen Aerogels

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Following the recent earnings report, the consensus from six analysts covering Aspen Aerogels is for revenues of US$119.7m in 2021, implying a discernible 3.2% decline in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 37% to US$0.41. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$132.7m and losses of US$0.35 per share in 2021. While next year's revenue estimates dropped there was also a loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

The average price target lifted 31% to US$14.83, clearly signalling that the weaker revenue and EPS outlook are not expected to weigh on the stock over the longer term. 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. Currently, the most bullish analyst values Aspen Aerogels at US$18.00 per share, while the most bearish prices it at US$8.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that sales are expected to slow, with a forecast revenue decline of 3.2%, a significant reduction from annual growth of 1.6% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.2% annually for the foreseeable future. It's pretty clear that Aspen Aerogels' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Aspen Aerogels. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Aspen Aerogels going out to 2024, and you can see them free on our platform here.

Even so, be aware that Aspen Aerogels is showing 3 warning signs in our investment analysis , you should know about...

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. 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.

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