Stock Analysis

News Flash: Analysts Just Made A Sizeable Upgrade To Their Bicycle Therapeutics plc (NASDAQ:BCYC) Forecasts

  •  Updated
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Bicycle Therapeutics plc (NASDAQ:BCYC) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

Following the latest upgrade, the current consensus, from the nine analysts covering Bicycle Therapeutics, is for revenues of US$9.9m in 2021, which would reflect a not inconsiderable 10% reduction in Bicycle Therapeutics' sales over the past 12 months. Losses are forecast to narrow 3.1% to US$2.69 per share. Yet before this consensus update, the analysts had been forecasting revenues of US$8.6m and losses of US$3.05 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.

See our latest analysis for Bicycle Therapeutics

NasdaqGS:BCYC Earnings and Revenue Growth May 8th 2021

Despite these upgrades, the analysts have not made any major changes to their price target of US$40.11, implying that their latest estimates don't have a long term impact on what they think the stock is worth. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bicycle Therapeutics, with the most bullish analyst valuing it at US$58.00 and the most bearish at US$30.00 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

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. We would highlight that sales are expected to reverse, with a forecast 14% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 30% over the last year. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 14% annually for the foreseeable future. It's pretty clear that Bicycle Therapeutics' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Bicycle Therapeutics' prospects. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow slower than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So Bicycle Therapeutics could be a good candidate for more research.

Analysts are clearly in love with Bicycle Therapeutics at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as 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.

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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What are the risks and opportunities for Bicycle Therapeutics?

Bicycle Therapeutics plc, a clinical-stage biopharmaceutical company, develops a class of medicines for diseases that are underserved by existing therapeutics.

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  • Revenue is forecast to grow 61.61% per year


  • Currently unprofitable and not forecast to become profitable over the next 3 years

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