Earnings Update: Aquestive Therapeutics, Inc. (NASDAQ:AQST) Just Reported And Analysts Are Trimming Their Forecasts

Explore Aquestive Therapeutics's Fair Values from the Community and select yours

Investors in Aquestive Therapeutics, Inc. (NASDAQ:AQST) had a good week, as its shares rose 2.0% to close at US$4.01 following the release of its quarterly results. Revenues of US$10m fell short of estimates by 12%, but statutory losses were tightly controlled, with the per-share loss of US$0.14 being 17% smaller than consensus predictions. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Taking into account the latest results, the current consensus, from the nine analysts covering Aquestive Therapeutics, is for revenues of US$42.0m in 2025. This implies a small 4.9% reduction in Aquestive Therapeutics' revenue over the past 12 months. Per-share losses are supposed to see a sharp uptick, reaching US$0.72. Before this latest report, the consensus had been expecting revenues of US$45.1m and US$0.72 per share in losses.

See our latest analysis for Aquestive Therapeutics

The average price target fell 9.6% to US$8.42, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing losses. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Aquestive Therapeutics at US$15.00 per share, while the most bearish prices it at US$4.75. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Aquestive Therapeutics' past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 9.5% annualised decline to the end of 2025. That is a notable change from historical growth of 1.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.1% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Aquestive Therapeutics is expected to lag the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

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 estimates - from multiple Aquestive Therapeutics analysts - going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - Aquestive Therapeutics has 2 warning signs (and 1 which shouldn't be ignored) we think you should know about.

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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.