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Earnings Update: MeiraGTx Holdings plc (NASDAQ:MGTX) Just Reported And Analysts Are Boosting Their Estimates

Simply Wall St
·4 min read

MeiraGTx Holdings plc (NASDAQ:MGTX) just released its quarterly report and things are looking bullish. The results were impressive, with revenues of US$5.1m exceeding analyst forecasts by 461%, and statutory losses of US$0.17 were likewise much smaller than the analysts had forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on MeiraGTx Holdings after the latest results.

See our latest analysis for MeiraGTx Holdings

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earnings-and-revenue-growth

Following the recent earnings report, the consensus from four analysts covering MeiraGTx Holdings is for revenues of US$10.4m in 2021, implying a stressful 44% decline in sales compared to the last 12 months. Losses are forecast to balloon 82% to US$2.62 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$7.97m and losses of US$2.99 per share in 2021. We can see there's definitely been a change in sentiment in this update, with the analysts administering a sizeable upgrade to next year's revenue estimates, while at the same time reducing their loss estimates.

The consensus price target fell 6.3%, to US$32.43, suggesting that the analysts remain pessimistic on the company, despite the improved earnings and revenue outlook. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic MeiraGTx Holdings analyst has a price target of US$45.00 per share, while the most pessimistic values it at US$20.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 44%, a significant reduction from annual growth of 191% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 20% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - MeiraGTx Holdings is expected to lag the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of MeiraGTx Holdings' future valuation.

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. At Simply Wall St, we have a full range of analyst estimates for MeiraGTx Holdings going out to 2024, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 3 warning signs for MeiraGTx Holdings (1 is potentially serious!) 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.