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Results: Pacific Biosciences of California, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

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Simply Wall St
·3 min read
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Pacific Biosciences of California, Inc. (NASDAQ:PACB) just released its latest annual results and things are looking bullish. The company beat both earnings and revenue forecasts, with revenue of US$79m, some 3.1% above estimates, and statutory earnings per share (EPS) coming in at US$0.17, 211% ahead of expectations. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Pacific Biosciences of California

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earnings-and-revenue-growth

After the latest results, the five analysts covering Pacific Biosciences of California are now predicting revenues of US$128.9m in 2021. If met, this would reflect a huge 63% improvement in sales compared to the last 12 months. The company is forecast to report a statutory loss of US$0.47 in 2021, a sharp decline from a profit over the last year. Before this earnings announcement, the analysts had been modelling revenues of US$128.9m and losses of US$0.47 per share in 2021.

The consensus price target rose 83% to US$50.80, with the analysts increasing their valuations as the business executes in line with forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Pacific Biosciences of California analyst has a price target of US$45.00 per share, while the most pessimistic values it at US$12.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Pacific Biosciences of California's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Pacific Biosciences of California is forecast to grow faster in the future than it has in the past, with revenues expected to grow 63%. If achieved, this would be a much better result than the 3.8% annual decline over the past five years. Compare this against analyst estimates for the wider industry, which suggest that (in aggregate) industry revenues are expected to grow 9.3% next year. So it looks like Pacific Biosciences of California is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Pacific Biosciences of California. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Pacific Biosciences of California going out to 2025, and you can see them free on our platform here..

However, before you get too enthused, we've discovered 4 warning signs for Pacific Biosciences of California (1 can't be ignored!) 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 (at) simplywallst.com.