Results: Aurinia Pharmaceuticals Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

Aurinia Pharmaceuticals Inc. (NASDAQ:AUPH) 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$235m were what the analysts expected, Aurinia Pharmaceuticals surprised by delivering a (statutory) profit of US$0.04 per share, an impressive 54% above what was forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Aurinia Pharmaceuticals

Taking into account the latest results, the consensus forecast from Aurinia Pharmaceuticals' six analysts is for revenues of US$258.6m in 2025. This reflects a meaningful 10.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 1,010% to US$0.47. Before this earnings report, the analysts had been forecasting revenues of US$274.4m and earnings per share (EPS) of US$0.57 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.

It'll come as no surprise then, to learn that the analysts have cut their price target 5.1% to US$10.29. 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. The most optimistic Aurinia Pharmaceuticals analyst has a price target of US$13.00 per share, while the most pessimistic values it at US$8.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Aurinia Pharmaceuticals' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 10.0% growth on an annualised basis. This is compared to a historical growth rate of 47% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 20% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Aurinia Pharmaceuticals.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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. At Simply Wall St, we have a full range of analyst estimates for Aurinia Pharmaceuticals going out to 2027, and you can see them free on our platform here..

Even so, be aware that Aurinia Pharmaceuticals is showing 1 warning sign in our investment analysis , 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.