ImmunoGen, Inc. (NASDAQ:IMGN) just released its latest quarterly report and things are not looking great. It looks like a pretty negative result overall with revenues of US$13m coming in 11% short of analyst estimates. Statutory losses were US$0.17 per share, 11% larger than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the ten analysts covering ImmunoGen provided consensus estimates of US$63.1m revenue in 2020, which would reflect a concerning 27% decline on its sales over the past 12 months. Per-share losses are expected to explode, reaching US$0.70 per share. Before this earnings announcement, the analysts had been modelling revenues of US$62.6m and losses of US$0.68 per share in 2020. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although sales forecasts held steady, the consensus also made a to its losses per share forecasts.
With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 5.0% to US$6.75, with the analysts signalling that growing losses would be a definite concern. 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 ImmunoGen at US$12.00 per share, while the most bearish prices it at US$4.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. Over the past five years, revenues have declined around 1.1% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for a 27% decline in revenue next year. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 18% next year. So while a broad number of companies are forecast to decline, unfortunately ImmunoGen is expected to see its sales affected worse than other companies in the industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at ImmunoGen. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will 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 ImmunoGen's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for ImmunoGen going out to 2024, and you can see them free on our platform here.
Plus, you should also learn about the 3 warning signs we've spotted with ImmunoGen .
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.