Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. Investors have been pretty optimistic on Y-mAbs Therapeutics too, with the stock up 30% to US$8.99 over the past week. Could this upgrade be enough to drive the stock even higher?
Following the upgrade, the most recent consensus for Y-mAbs Therapeutics from its seven analysts is for revenues of US$84m in 2023 which, if met, would be a solid 12% increase on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 46% to US$0.91. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$66m and losses of US$1.11 per share in 2023. We can see there's definitely been a change in sentiment in this update, with the analysts administering a sizeable upgrade to this year's revenue estimates, while at the same time reducing their loss estimates.
View our latest analysis for Y-mAbs Therapeutics
The consensus price target rose 14% to US$10.83, with the analysts encouraged by the higher revenue and lower forecast losses for this year. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Y-mAbs Therapeutics, with the most bullish analyst valuing it at US$21.00 and the most bearish at US$5.00 per share. We would probably assign less value to the forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.
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 Y-mAbs Therapeutics' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 70% over the past five years. Compare this to the 645 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 19% per year. So it's pretty clear that, while Y-mAbs Therapeutics' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Y-mAbs Therapeutics' prospects. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Y-mAbs Therapeutics.
Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Y-mAbs Therapeutics going out to 2025, and you can see them free on our platform here..
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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.