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Earnings Update: Ascendis Pharma A/S (NASDAQ:ASND) Just Reported Its Third-Quarter Results And Analysts Are Updating Their Forecasts

Simply Wall St
·3 min read

The quarterly results for Ascendis Pharma A/S (NASDAQ:ASND) were released last week, making it a good time to revisit its performance. Revenues of €2.8m crushed expectations, although expenses also blew out, with the company reporting a statutory loss per share of €2.31, 44% bigger than analysts expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Ascendis Pharma

earnings-and-revenue-growth
earnings-and-revenue-growth

Taking into account the latest results, the consensus forecast from Ascendis Pharma's ten analysts is for revenues of €56.4m in 2021, which would reflect a major 532% improvement in sales compared to the last 12 months. Losses are expected to be contained, narrowing 19% from last year to €5.96. Before this latest report, the consensus had been expecting revenues of €56.9m and €6.58 per share in losses. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for next year.

There's been no major changes to the consensus price target of €160, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's 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. Currently, the most bullish analyst values Ascendis Pharma at €213 per share, while the most bearish prices it at €166. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ascendis Pharma's past performance and to peers in the same industry. It's clear from the latest estimates that Ascendis Pharma's rate of growth is expected to accelerate meaningfully, with the forecast 5x revenue growth noticeably faster than its historical growth of 21%p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 21% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Ascendis Pharma is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at €160, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Ascendis Pharma. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Ascendis Pharma going out to 2024, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Ascendis Pharma that you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.