Downgrade: Here's How Analysts See Cryoport, Inc. (NASDAQ:CYRX) Performing In The Near Term

One thing we could say about the analysts on Cryoport, Inc. (NASDAQ:CYRX) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon. Shares are up 7.5% to US$16.16 in the past week. We'd be curious to see if the downgrade is enough to reverse investor sentiment on the business.

After the downgrade, the consensus from Cryoport's eight analysts is for revenues of US$234m in 2023, which would reflect a discernible 5.6% decline in sales compared to the last year of performance. Per-share losses are expected to creep up to US$0.88. However, before this estimates update, the consensus had been expecting revenues of US$275m and US$0.61 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

See our latest analysis for Cryoport

The consensus price target fell 31% to US$21.63, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Cryoport at US$33.00 per share, while the most bearish prices it at US$10.00. With such a wide range in price targets, the analysts are almost certainly betting on widely diverse outcomes for the underlying business. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Cryoport's past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 7.4% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 53% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Cryoport is expected to lag the wider industry.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Cryoport. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Cryoport.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Cryoport analysts - going out to 2025, 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.

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