Party Time: Brokers Just Made Major Increases To Their Agenus Inc. (NASDAQ:AGEN) Earnings Forecasts

By
Simply Wall St
Published
August 10, 2021
NasdaqCM:AGEN
Source: Shutterstock

Shareholders in Agenus Inc. (NASDAQ:AGEN) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

After the upgrade, the three analysts covering Agenus are now predicting revenues of US$220m in 2021. If met, this would reflect a huge 221% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 61% to US$0.44. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$158m and losses of US$1.03 per share in 2021. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

View our latest analysis for Agenus

earnings-and-revenue-growth
NasdaqCM:AGEN Earnings and Revenue Growth August 11th 2021

The consensus price target rose 5.6% to US$9.50, with the analysts encouraged by the higher revenue and lower forecast losses for this year. 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 Agenus at US$11.00 per share, while the most bearish prices it at US$8.00. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Agenus' rate of growth is expected to accelerate meaningfully, with the forecast 9x annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 27% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.4% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Agenus to grow faster than the wider industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Agenus is moving incrementally towards profitability. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Agenus.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 5 potential concerns with Agenus, including dilutive stock issuance over the past year. You can learn more, and discover the 3 other concerns we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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