Results: BioMarin Pharmaceutical Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates

Last week, you might have seen that BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) released its first-quarter result to the market. The early response was not positive, with shares down 8.8% to US$82.17 in the past week. Revenues were US$649m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.46, an impressive 41% ahead of estimates. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for BioMarin Pharmaceutical

Following the latest results, BioMarin Pharmaceutical's 27 analysts are now forecasting revenues of US$2.75b in 2024. This would be a meaningful 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 66% to US$1.80. Before this earnings report, the analysts had been forecasting revenues of US$2.76b and earnings per share (EPS) of US$1.59 in 2024. Although the revenue estimates have not really changed, we can see there's been a nice increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

The consensus price target was unchanged at US$110, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic BioMarin Pharmaceutical analyst has a price target of US$140 per share, while the most pessimistic values it at US$80.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting BioMarin Pharmaceutical's growth to accelerate, with the forecast 15% annualised growth to the end of 2024 ranking favourably alongside historical growth of 8.3% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 17% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that BioMarin Pharmaceutical is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards BioMarin Pharmaceutical following these results. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 BioMarin Pharmaceutical going out to 2026, and you can see them free on our platform here.

Even so, be aware that BioMarin Pharmaceutical is showing 1 warning sign in our investment analysis , you should know about...

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.