ACADIA Pharmaceuticals Inc. Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. It looks like a credible result overall - although revenues of US$958m were what the analysts expected, ACADIA Pharmaceuticals surprised by delivering a (statutory) profit of US$1.36 per share, an impressive 95% above what was forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for ACADIA Pharmaceuticals

Taking into account the latest results, the most recent consensus for ACADIA Pharmaceuticals from 20 analysts is for revenues of US$1.06b in 2025. If met, it would imply a solid 11% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to plummet 61% to US$0.53 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.05b and earnings per share (EPS) of US$0.78 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.

The consensus price target held steady at US$24.75, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on ACADIA Pharmaceuticals, with the most bullish analyst valuing it at US$37.00 and the most bearish at US$11.00 per share. 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. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

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. 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 11% 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 20% 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple ACADIA Pharmaceuticals analysts - going out to 2027, 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 ACADIA Pharmaceuticals , and understanding this 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.