Shareholders in CytomX Therapeutics, Inc. (NASDAQ:CTMX) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for next year has experienced a facelift, with analysts now much more optimistic on its sales pipeline.
Following the upgrade, the latest consensus from CytomX Therapeutics' nine analysts is for revenues of US$73m in 2023, which would reflect an okay 2.1% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 42% to US$0.86. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$64m and losses of US$0.87 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, withthe analysts noticeably increasing their revenue forecasts while also expecting losses per share to hold steady.
Our analysis indicates that CTMX is potentially overvalued!
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. We can infer from the latest estimates that forecasts expect a continuation of CytomX Therapeutics'historical trends, as the 1.7% annualised revenue growth to the end of 2023 is roughly in line with the 1.6% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 14% per year. So although CytomX Therapeutics is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.
The Bottom Line
The highlight for us was that the consensus reduced its estimated losses next year, perhaps suggesting CytomX Therapeutics is moving incrementally towards profitability. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. Seeing the dramatic upgrade to next year's forecasts, it might be time to take another look at CytomX Therapeutics.
Still, 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 CytomX Therapeutics going out to 2024, and you can see them free on our platform here..
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
What are the risks and opportunities for CytomX Therapeutics?
Trading at 36.9% below our estimate of its fair value
Highly volatile share price over the past 3 months
Currently unprofitable and not forecast to become profitable over the next 3 years
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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.