Need To Know: The Consensus Just Cut Its Hansa Biopharma AB (publ) (STO:HNSA) Estimates For 2023

One thing we could say about the analysts on Hansa Biopharma AB (publ) (STO:HNSA) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the downgrade, the most recent consensus for Hansa Biopharma from its five analysts is for revenues of kr167m in 2023 which, if met, would be a meaningful 20% increase on its sales over the past 12 months. Losses are expected to increase slightly, to kr13.04 per share. Yet before this consensus update, the analysts had been forecasting revenues of kr194m and losses of kr13.17 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also making no real change to the loss per share numbers.

See our latest analysis for Hansa Biopharma

There was no real change to the consensus price target of kr178, suggesting that the revisions to revenue estimates are not expected to have a long-term impact on Hansa Biopharma's valuation. 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. There are some variant perceptions on Hansa Biopharma, with the most bullish analyst valuing it at kr245 and the most bearish at kr128 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.

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 would highlight that Hansa Biopharma's revenue growth is expected to slow, with the forecast 15% annualised growth rate until the end of 2023 being well below the historical 77% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 25% per year. Factoring in the forecast slowdown in growth, it seems obvious that Hansa Biopharma is also expected to grow slower than other industry participants.

The Bottom Line

Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. 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 Hansa Biopharma after today.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Hansa Biopharma analysts - going out to 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.