Akeso, Inc. Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

It's been a good week for Akeso, Inc. (HKG:9926) shareholders, because the company has just released its latest half-yearly results, and the shares gained 7.0% to HK$49.10. Results look mixed - while revenue fell marginally short of analyst estimates at CN¥1.0b, statutory earnings were in line with expectations, at CN¥2.42 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Akeso

After the latest results, the 23 analysts covering Akeso are now predicting revenues of CN¥2.61b in 2024. If met, this would reflect a huge 39% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 51% to CN¥0.42. Yet prior to the latest earnings, the analysts had been forecasting revenues of CN¥2.58b and losses of CN¥0.48 per share in 2024. While the revenue estimates were largely unchanged, sentiment seems to have improved, with the analysts upgrading their numbers and making a notable improvement in losses per share in particular.

There's been no major changes to the consensus price target of HK$60.54, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. 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. There are some variant perceptions on Akeso, with the most bullish analyst valuing it at HK$69.87 and the most bearish at HK$46.25 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Akeso's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Akeso'shistorical trends, as the 94% annualised revenue growth to the end of 2024 is roughly in line with the 80% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 27% per year. So it's pretty clear that Akeso is forecast to grow substantially 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. Happily, there were no major changes to revenue forecasts, with the business still 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.

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. We have estimates - from multiple Akeso analysts - going out to 2026, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Akeso , and understanding these should be part of your investment process.

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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.