Results: Bavarian Nordic A/S Delivered A Surprise Loss And Now Analysts Have New Forecasts

Investors in Bavarian Nordic A/S (CPH:BAVA) had a good week, as its shares rose 4.7% to close at kr.163 following the release of its quarterly results. Revenues fell badly short of expectations, with revenue of kr.831m missing analyst predictions by 25%. Statutory earnings correspondingly nosedived, with Bavarian Nordic reporting a loss of kr.1.50 per share, where the analysts were expecting a profit. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Bavarian Nordic

Taking into account the latest results, the current consensus, from the five analysts covering Bavarian Nordic, is for revenues of kr.5.23b in 2024. This implies a sizeable 21% reduction in Bavarian Nordic's revenue over the past 12 months. Statutory earnings per share are forecast to crater 29% to kr.8.93 in the same period. Before this earnings report, the analysts had been forecasting revenues of kr.5.22b and earnings per share (EPS) of kr.8.15 in 2024. So the consensus seems to have become somewhat more optimistic on Bavarian Nordic's earnings potential following these results.

The consensus price target was unchanged at kr.262, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Bavarian Nordic, with the most bullish analyst valuing it at kr.331 and the most bearish at kr.170 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 27% by the end of 2024. This indicates a significant reduction from annual growth of 45% 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 18% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Bavarian Nordic is expected to lag the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Bavarian Nordic's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Bavarian Nordic's revenue is expected to perform worse than the wider industry. The consensus price target held steady at kr.262, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Bavarian Nordic going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Bavarian Nordic has 1 warning sign we think you should be aware of.

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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.