Beam Therapeutics Inc. (NASDAQ:BEAM) Consensus Forecasts Have Become A Little Darker Since Its Latest Report

Beam Therapeutics Inc. (NASDAQ:BEAM) defied analyst predictions to release its yearly results, which were ahead of market expectations. The results were impressive, with revenues of US$378m exceeding analyst forecasts by 303%, and statutory losses of US$1.72 were likewise much smaller than the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Beam Therapeutics

Taking into account the latest results, the current consensus, from the twelve analysts covering Beam Therapeutics, is for revenues of US$67.2m in 2024. This implies a stressful 82% reduction in Beam Therapeutics' revenue over the past 12 months. Losses are forecast to balloon 227% to US$5.51 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$72.6m and losses of US$4.55 per share in 2024. While this year's revenue estimates dropped there was also a very substantial increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

There was no major change to the consensus price target of US$48.38, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. 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. The most optimistic Beam Therapeutics analyst has a price target of US$78.00 per share, while the most pessimistic values it at US$19.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 82% annualised decline to the end of 2024. That is a notable change from historical growth of 81% 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 18% annually for the foreseeable future. It's pretty clear that Beam Therapeutics' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for 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. The consensus price target held steady at US$48.38, with the latest estimates not enough to have an impact on their price targets.

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 forecasts for Beam Therapeutics going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Beam Therapeutics has 4 warning signs (and 1 which can'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.