New Forecasts: Here's What Analysts Think The Future Holds For Adaptimmune Therapeutics plc (NASDAQ:ADAP)

Adaptimmune Therapeutics plc (NASDAQ:ADAP) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's forecasts. The revenue forecast for next year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. Adaptimmune Therapeutics has also found favour with investors, with the stock up an unbelievable 43% to US$2.08 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the most recent consensus for Adaptimmune Therapeutics from its six analysts is for revenues of US$32m in 2023 which, if met, would be a major 174% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of US$28m in 2023. The consensus has definitely become more optimistic, showing a solid increase in revenue forecasts.

Check out the opportunities and risks within the US Biotechs industry.

There was no particular change to the consensus price target of US$5.10, with Adaptimmune Therapeutics' latest outlook seemingly not enough to result in a change of 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. There are some variant perceptions on Adaptimmune Therapeutics, with the most bullish analyst valuing it at US$10.00 and the most bearish at US$1.50 per share. We would probably assign less value to the 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 possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Adaptimmune Therapeutics' past performance and to peers in the same industry. One thing stands out from these estimates, which is that Adaptimmune Therapeutics is forecast to grow faster in the future than it has in the past, with revenues expected to display 124% annualised growth until the end of 2023. If achieved, this would be a much better result than the 52% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 14% per year. Not only are Adaptimmune Therapeutics' 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 from this upgrade is that analysts lifted their revenue estimates for next year. They're also forecasting more rapid revenue growth than the wider market. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at Adaptimmune Therapeutics.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 4 potential warning signs with Adaptimmune Therapeutics, including dilutive stock issuance over the past year. For more information, you can click through to our platform to learn more about this and the 3 other warning signs we've identified .

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks 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.