Beam Therapeutics Inc. (NASDAQ:BEAM) Analysts Are Cutting Their Estimates: Here's What You Need To Know
As you might know, Beam Therapeutics Inc. (NASDAQ:BEAM) just kicked off its latest annual results with some very strong numbers. The results were impressive, with revenues of US$378m exceeding analyst forecasts by 303%, and statutory losses of US$1.72 were likewise much smaller than the analysts had forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Beam Therapeutics
Taking into account the latest results, the twelve analysts covering Beam Therapeutics provided consensus estimates of US$67.2m revenue in 2024, which would reflect a substantial 82% decline over the past 12 months. Losses are forecast to balloon 227% to US$5.51 per share. Before this latest report, the consensus had been expecting revenues of US$72.6m and US$4.55 per share in losses. So it's pretty clear the analysts have mixed opinions on Beam Therapeutics after this update; revenues were downgraded and per-share losses expected to increase.
The average price target was broadly unchanged at US$48.38, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Beam Therapeutics analyst has a price target of US$78.00 per share, while the most pessimistic values it at US$19.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Beam Therapeutics' past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 82% by the end of 2024. This indicates a significant reduction from annual growth of 81% 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 18% annually for the foreseeable future. It's pretty clear that Beam Therapeutics' 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 Beam Therapeutics. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at US$48.38, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Beam Therapeutics analysts - going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 4 warning signs we've spotted with Beam Therapeutics (including 1 which is concerning) .
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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.
