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. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance. 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?

After the upgrade, the seven analysts covering Y-mAbs Therapeutics are now predicting revenues of US$84m in 2023. If met, this would reflect a solid 12% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 46% to US$0.91. Yet before this consensus update, the analysts had been forecasting revenues of US$66m and losses of US$1.11 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for Y-mAbs Therapeutics

It will come as no surprise to learn that the analysts have increased their price target for Y-mAbs Therapeutics 14% to US$10.83 on the back of these upgrades. 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. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Y-mAbs Therapeutics' revenue growth is expected to slow, with the forecast 16% annualised growth rate until the end of 2023 being well below the historical 70% p.a. growth over the last 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. Factoring in the forecast slowdown in growth, it looks like Y-mAbs Therapeutics is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Y-mAbs Therapeutics is moving incrementally towards profitability. They also upgraded their revenue forecasts, although the latest estimates suggest that Y-mAbs Therapeutics will grow in line with the overall market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Y-mAbs Therapeutics.

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 Y-mAbs Therapeutics going out to 2025, and you can see them free on our platform here..

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.

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