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

ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) just released its first-quarter report and things are looking bullish. ACADIA Pharmaceuticals beat earnings, with revenues hitting US$244m, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 17%. 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.

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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 an okay 6.8% increase on its revenue over the past 12 months. Statutory earnings per share are expected to plummet 56% to US$0.61 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.06b and earnings per share (EPS) of US$0.55 in 2025. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the nice increase in earnings per share expectations following these results.

See our latest analysis for ACADIA Pharmaceuticals

There's been no major changes to the consensus price target of US$24.37, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values ACADIA Pharmaceuticals at US$37.00 per share, while the most bearish prices it at US$11.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. 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. We would highlight that ACADIA Pharmaceuticals' revenue growth is expected to slow, with the forecast 9.2% annualised growth rate until the end of 2025 being well below the historical 20% 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 17% 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 most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards ACADIA Pharmaceuticals following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$24.37, with the latest estimates not enough to have an impact on their price targets.

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.

It is also worth noting that we have found 1 warning sign for ACADIA Pharmaceuticals that you need to take into consideration.

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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.