Analysts Are Upgrading Ocumension Therapeutics (HKG:1477) After Its Latest Results

There's been a notable change in appetite for Ocumension Therapeutics (HKG:1477) shares in the week since its half-year report, with the stock down 14% to HK$6.29. It was an okay report, and revenues came in at CN¥168m, approximately in line with analyst estimates leading up to the results announcement. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Ocumension Therapeutics

After the latest results, the three analysts covering Ocumension Therapeutics are now predicting revenues of CN¥466.3m in 2024. If met, this would reflect a substantial 50% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 25% to CN¥0.35. Before this latest report, the consensus had been expecting revenues of CN¥437.1m and CN¥0.36 per share in losses. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrades to both revenue and loss per share forecasts for this year.

Despite these upgrades,the analysts have not made any major changes to their price target of HK$9.85, implying that their latest estimates don't have a long term impact on what they think the stock is worth. 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 Ocumension Therapeutics at HK$11.64 per share, while the most bearish prices it at HK$8.89. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. The analysts are definitely expecting Ocumension Therapeutics' growth to accelerate, with the forecast 126% annualised growth to the end of 2024 ranking favourably alongside historical growth of 61% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Ocumension Therapeutics is expected to grow much faster than its industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Ocumension Therapeutics going out to 2026, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Ocumension Therapeutics that you need to take into consideration.

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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.