There's been a notable change in appetite for Coherus BioSciences, Inc. (NASDAQ:CHRS) shares in the week since its full-year report, with the stock down 14% to US$19.36. It was not a great result overall. While revenues of US$356m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 10% to hit US$1.23 per share. Following the result, 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. So we gathered the latest post-earnings forecasts to see what analysts' statutory forecasts suggest is in store for next year.
Taking into account the latest results, the latest consensus from Coherus BioSciences's five analysts is for revenues of US$478.5m in 2020, which would reflect a substantial 34% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to soar 91% to US$2.47. Yet prior to the latest earnings, analysts had been forecasting revenues of US$454.5m and earnings per share (EPS) of US$2.46 in 2020. So it looks like there's been no major change in sentiment following the latest results, although analysts have made a small lift in to revenue forecasts.
It may not be a surprise to see that analysts have reconfirmed their price target of US$33.00, implying that the uplift in sales is not expected to greatly contribute to Coherus BioSciences's valuation in the near term. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Coherus BioSciences at US$43.00 per share, while the most bearish prices it at US$27.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Coherus BioSciences shareholders.
Another way to assess these estimates is by comparing them to past performance, and seeing whether analysts are more or less bullish relative to other companies in the market. We can infer from the latest estimates that analysts are expecting a continuation of Coherus BioSciences's historical trends, as next year's forecast 34% revenue growth is roughly in line with 29% annual revenue growth over the past five years. Compare this with the wider market, which analyst estimates (in aggregate) suggest will see revenues grow 16% next year. So it's pretty clear that Coherus BioSciences is forecast to grow substantially faster than its market.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider market. 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.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Coherus BioSciences going out to 2024, and you can see them free on our platform here..
We also provide an overview of the Coherus BioSciences Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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