Revenue Beat: Biotage AB (publ) Exceeded Revenue Forecasts By 5.3% And Analysts Are Updating Their Estimates

Investors in Biotage AB (publ) (STO:BIOT) had a good week, as its shares rose 4.4% to close at kr166 following the release of its quarterly results. Biotage beat revenue expectations by 5.3%, at kr480m. Statutory earnings per share (EPS) came in at kr0.42, some 2.3% short of analyst estimates. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Biotage

Taking into account the latest results, the current consensus from Biotage's three analysts is for revenues of kr2.17b in 2024. This would reflect a decent 9.8% increase on its revenue over the past 12 months. Per-share earnings are expected to swell 17% to kr3.45. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr2.14b and earnings per share (EPS) of kr3.42 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at kr187. 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. Currently, the most bullish analyst values Biotage at kr200 per share, while the most bearish prices it at kr160. This is a very narrow spread of estimates, implying either that Biotage is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. We can infer from the latest estimates that forecasts expect a continuation of Biotage'shistorical trends, as the 13% annualised revenue growth to the end of 2024 is roughly in line with the 13% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 10.0% per year. So although Biotage is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue 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.

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. We have forecasts for Biotage 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 1 warning sign with Biotage , and understanding it 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.