ACADIA Pharmaceuticals Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

It's been a pretty great week for ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) shareholders, with its shares surging 18% to US$17.20 in the week since its latest quarterly results. Revenues were US$250m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.20, an impressive 43% ahead of 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for ACADIA Pharmaceuticals

Following the latest results, ACADIA Pharmaceuticals' 20 analysts are now forecasting revenues of US$1.05b in 2025. This would be a decent 13% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be US$0.78, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of US$1.05b and earnings per share (EPS) of US$0.85 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$25.00, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 ACADIA Pharmaceuticals at US$39.00 per share, while the most bearish prices it at US$11.00. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that ACADIA Pharmaceuticals' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 10% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 21% per year. Factoring in the forecast slowdown in growth, it seems obvious that ACADIA Pharmaceuticals is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for ACADIA Pharmaceuticals. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for ACADIA Pharmaceuticals going out to 2026, and you can see them free on our platform here.

We also provide an overview of the ACADIA Pharmaceuticals Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.