Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA) missed earnings with its latest yearly results, disappointing overly-optimistic forecasters. Enanta Pharmaceuticals missed analyst estimates, with revenues of US$68m and a statutory loss per share (eps) of US$5.48 falling 5.0% and 4.4% below expectations, respectively. 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 Enanta Pharmaceuticals after the latest results.
Taking into account the latest results, the most recent consensus for Enanta Pharmaceuticals from eight analysts is for revenues of US$72.5m in 2025. If met, it would imply an okay 7.2% increase on its revenue over the past 12 months. The loss per share is expected to ameliorate slightly, reducing to US$5.05. Before this earnings announcement, the analysts had been modelling revenues of US$73.5m and losses of US$4.95 per share in 2025. So it's pretty clear consensus is mixed on Enanta Pharmaceuticals after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a modest increase to per-share loss expectations.
With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 7.6% to US$18.13, with the analysts signalling that growing losses would be a definite concern. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Enanta Pharmaceuticals analyst has a price target of US$30.00 per share, while the most pessimistic values it at US$9.00. 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.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. For example, we noticed that Enanta Pharmaceuticals' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 7.2% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 21% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 22% annually for the foreseeable future. Although Enanta Pharmaceuticals' revenues are expected to improve, it seems that the analysts are still bearish on the business, forecasting it to grow slower than the broader 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 Enanta Pharmaceuticals. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Enanta Pharmaceuticals' revenue is expected to perform worse than the wider industry. 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Enanta Pharmaceuticals going out to 2027, and you can see them free on our platform here..
Before you take the next step you should know about the 2 warning signs for Enanta Pharmaceuticals (1 is concerning!) that we have uncovered.
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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.
