Upgrade: Analysts Just Made A Meaningful Increase To Their Dynavax Technologies Corporation (NASDAQ:DVAX) Forecasts

Dynavax Technologies Corporation (NASDAQ:DVAX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 23% to US$11.58 in the last 7 days. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the latest consensus from Dynavax Technologies' five analysts is for revenues of US$363m in 2021, which would reflect a huge 115% improvement in sales compared to the last 12 months. Losses are expected to turn into profits real soon, with the analysts forecasting US$0.57 in per-share earnings. Previously, the analysts had been modelling revenues of US$322m and earnings per share (EPS) of US$0.52 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

Check out our latest analysis for Dynavax Technologies

It will come as no surprise to learn that the analysts have increased their price target for Dynavax Technologies 8.5% to US$20.25 on the back of these upgrades. 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 Dynavax Technologies, with the most bullish analyst valuing it at US$22.00 and the most bearish at US$19.00 per share. This is a very narrow spread of estimates, implying either that Dynavax Technologies is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

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. It's clear from the latest estimates that Dynavax Technologies' rate of growth is expected to accelerate meaningfully, with the forecast 4x annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 67% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.2% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Dynavax Technologies is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Dynavax Technologies.

Analysts are clearly in love with Dynavax Technologies 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. For more information, you can click through to our platform to learn more about this and the 2 other risks we've identified .

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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