Biotage AB (publ) Just Missed EPS By 7.7%: Here's What Analysts Think Will Happen Next

It's been a pretty great week for Biotage AB (publ) (STO:BIOT) shareholders, with its shares surging 12% to kr190 in the week since its latest quarterly results. It looks like the results were a bit of a negative overall. While revenues of kr504m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 7.7% to hit kr0.60 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Biotage

Taking into account the latest results, the most recent consensus for Biotage from three analysts is for revenues of kr2.18b in 2024. If met, it would imply a credible 4.9% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 7.9% to kr3.39. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr2.11b and earnings per share (EPS) of kr3.26 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of kr191, suggesting that the forecast performance does not have a long term impact on the company'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. The most optimistic Biotage analyst has a price target of kr213 per share, while the most pessimistic values it at kr160. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Biotage's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 10.0% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. Compare this to the 12 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 9.2% per year. So it's pretty clear that, while Biotage's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Biotage following these results. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Biotage. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Biotage going out to 2026, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com