Intellia Therapeutics, Inc. (NASDAQ:NTLA) Analysts Are Cutting Their Estimates: Here's What You Need To Know
Intellia Therapeutics, Inc. (NASDAQ:NTLA) shareholders are probably feeling a little disappointed, since its shares fell 5.9% to US$26.10 in the week after its latest full-year results. Statutory results overall were mixed, with revenues coming in 28% lower than the analysts predicted. What's really surprising is that losses of US$5.42 per share were pretty much in line with forecasts, despite the revenue miss. Following the result, the 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Intellia Therapeutics after the latest results.
See our latest analysis for Intellia Therapeutics
Following the latest results, Intellia Therapeutics' 27 analysts are now forecasting revenues of US$52.8m in 2024. This would be a sizeable 46% improvement in revenue compared to the last 12 months. Per-share losses are predicted to creep up to US$5.48. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$58.5m and losses of US$5.70 per share in 2024. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers fell somewhat.
The analysts have cut their price target 6.8% to US$70.40per share, suggesting that the declining revenue was a more crucial indicator than the forecast reduction in losses. 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 Intellia Therapeutics at US$144 per share, while the most bearish prices it at US$24.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Intellia Therapeutics' growth to accelerate, with the forecast 46% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.2% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 17% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Intellia Therapeutics to grow faster than 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. They also downgraded Intellia Therapeutics' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Still, earnings are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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. We have forecasts for Intellia Therapeutics going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example - Intellia Therapeutics has 3 warning signs we think you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
