New Forecasts: Here's What Analysts Think The Future Holds For Translate Bio, Inc. (NASDAQ:TBIO)
Translate Bio, Inc. (NASDAQ:TBIO) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. Translate Bio has also found favour with investors, with the stock up an incredible 51% to US$23.87 over the past week. Could this upgrade be enough to drive the stock even higher?
After the upgrade, the five analysts covering Translate Bio are now predicting revenues of US$16m in 2020. If met, this would reflect a sizeable 49% improvement in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing US$11m of revenue in 2020. The consensus has definitely become more optimistic, showing a sizeable gain to revenue forecasts.
View our latest analysis for Translate Bio
Additionally, the consensus price target for Translate Bio increased 19% to US$24.17, showing a clear increase in optimism from the analysts involved. 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. Currently, the most bullish analyst values Translate Bio at US$30.00 per share, while the most bearish prices it at US$17.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Translate Bio's revenue growth will slow down substantially, with revenues next year expected to grow 49%, compared to a historical growth rate of 278% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 25% next year. So it's pretty clear that, while Translate Bio's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. They're also forecasting more rapid revenue growth than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Translate Bio.
These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 3 potential warning signs with Translate Bio, including dilutive stock issuance over the past year. For more information, you can click through to our platform to learn more about this and the 2 other warning signs we've identified .
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
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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