Pharming Group N.V. (AMS:PHARM) Analysts Are Pretty Bullish On The Stock After Recent Results
Pharming Group N.V. (AMS:PHARM) came out with its yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It was an okay result overall, with revenues coming in at US$245m, roughly what the analysts had been expecting. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Pharming Group
Taking into account the latest results, the most recent consensus for Pharming Group from five analysts is for revenues of US$284.6m in 2024. If met, it would imply a solid 16% increase on its revenue over the past 12 months. Per-share statutory losses are expected to explode, reaching US$0.0033 per share. In the lead-up to this report, the analysts had been modelling revenues of US$285.2m and earnings per share (EPS) of US$0.0052 in 2024. So despite reconfirming their revenue estimates, the analysts are now forecasting a loss instead of a profit, which looks like a definite drop in sentiment following the latest results.
Although the analysts are now forecasting higher losses, the average price target rose 5.6% to 1.8, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business. 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 Pharming Group at €2.10 per share, while the most bearish prices it at €1.60. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Pharming Group's growth to accelerate, with the forecast 16% annualised growth to the end of 2024 ranking favourably alongside historical growth of 5.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 19% annually. Pharming Group is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The most important thing to take away is that the analysts are expecting Pharming Group to become unprofitable next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Pharming Group analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Pharming Group that you need to take into consideration.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
