Newsflash: Alphamab Oncology (HKG:9966) Analysts Have Been Trimming Their Revenue Forecasts

Market forces rained on the parade of Alphamab Oncology (HKG:9966) shareholders today, when the analysts downgraded their forecasts for this year. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the latest downgrade, the current consensus, from the eight analysts covering Alphamab Oncology, is for revenues of CN¥184m in 2022, which would reflect a noticeable 7.7% reduction in Alphamab Oncology's sales over the past 12 months. Before the latest update, the analysts were foreseeing CN¥217m of revenue in 2022. It looks like forecasts have become a fair bit less optimistic on Alphamab Oncology, given the measurable cut to revenue estimates.

Check out our latest analysis for Alphamab Oncology

Additionally, the consensus price target for Alphamab Oncology increased 9.1% to CN¥13.43, showing a clear increase in optimism from the analysts involved. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Alphamab Oncology, with the most bullish analyst valuing it at CN¥20.23 and the most bearish at CN¥10.42 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 15% by the end of 2022. This indicates a significant reduction from annual growth of 133% over the last three years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 36% per year. It's pretty clear that Alphamab Oncology's revenues are expected to perform substantially worse than 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. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Alphamab Oncology after today.

Want to learn more? We have estimates for Alphamab Oncology from its eight analysts out until 2025, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.