What You Need To Know About The Molecular Partners AG (VTX:MOLN) Analyst Downgrade Today

One thing we could say about the analysts on Molecular Partners AG (VTX:MOLN) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following this downgrade, Molecular Partners' seven analysts are forecasting 2022 revenues to be CHF186m, approximately in line with the last 12 months. Before the latest update, the analysts were foreseeing CHF291m of revenue in 2022. It looks like forecasts have become a fair bit less optimistic on Molecular Partners, given the pretty serious reduction to revenue estimates.

View our latest analysis for Molecular Partners

Notably, the analysts have cut their price target 30% to CHF21.47, suggesting concerns around Molecular Partners' valuation. 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. Currently, the most bullish analyst values Molecular Partners at CHF50.00 per share, while the most bearish prices it at CHF6.00. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Molecular Partners' past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 3.9% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 49% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 27% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Molecular Partners is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their revenue estimates for this year. They also expect company revenue to perform worse than the wider market. Furthermore, there was a cut to the price target, suggesting that the latest news has led to more pessimism about the intrinsic value of the business. Given the stark change in sentiment, we'd understand if investors became more cautious on Molecular Partners after today.

There might be good reason for analyst bearishness towards Molecular Partners, like dilutive stock issuance over the past year. For more information, you can click here to discover this and the 1 other concern we've identified.

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

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