Danimer Scientific, Inc. (NYSE:DNMR) Analysts Are Cutting Their Estimates: Here's What You Need To Know

Danimer Scientific, Inc. (NYSE:DNMR) shareholders are probably feeling a little disappointed, since its shares fell 6.7% to US$0.75 in the week after its latest quarterly results. Despite revenues of US$10m falling 4.7% short of expectations, statutory losses of US$0.20 per share were well contained, and in line with analyst models. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Danimer Scientific

Taking into account the latest results, the most recent consensus for Danimer Scientific from five analysts is for revenues of US$60.9m in 2024. If met, it would imply a sizeable 35% increase on its revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 27% to US$0.92. Before this earnings announcement, the analysts had been modelling revenues of US$78.3m and losses of US$0.68 per share in 2024. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.

The average price target was broadly unchanged at US$1.13, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Danimer Scientific at US$2.00 per share, while the most bearish prices it at US$1.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. One thing stands out from these estimates, which is that Danimer Scientific is forecast to grow faster in the future than it has in the past, with revenues expected to display 50% annualised growth until the end of 2024. If achieved, this would be a much better result than the 4.9% annual decline over the past three years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.9% annually. Not only are Danimer Scientific's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. The consensus price target held steady at US$1.13, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Danimer Scientific analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Danimer Scientific has 5 warning signs (and 2 which are significant) we think you should know about.

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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.