As you might know, Clinuvel Pharmaceuticals Limited (ASX:CUV) last week released its latest interim, and things did not turn out so great for shareholders. Clinuvel Pharmaceuticals delivered a grave earnings miss, with both revenues (AU$14m) and statutory earnings per share (AU$0.13) falling badly short of analyst expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
After the latest results, the two analysts covering Clinuvel Pharmaceuticals are now predicting revenues of AU$45.0m in 2021. If met, this would reflect a notable 17% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to crater 23% to AU$0.35 in the same period. In the lead-up to this report, the analysts had been modelling revenues of AU$45.9m and earnings per share (EPS) of AU$0.26 in 2021. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the great increase in earnings per share expectations following these results.
There's been no major changes to the consensus price target of AU$28.39, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Clinuvel Pharmaceuticals' revenue growth will slow down substantially, with revenues next year expected to grow 17%, compared to a historical growth rate of 31% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 12% next year. Even after the forecast slowdown in growth, it seems obvious that Clinuvel Pharmaceuticals is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Clinuvel Pharmaceuticals following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 analyst estimates for Clinuvel Pharmaceuticals going out as far as 2023, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Clinuvel Pharmaceuticals that you need to take into consideration.
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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