Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

Shareholders might have noticed that Enanta Pharmaceuticals, Inc. (NASDAQ:ENTA) filed its quarterly result this time last week. The early response was not positive, with shares down 8.3% to US$12.76 in the past week. The results don't look great, especially considering that statutory losses grew 13% toUS$1.47 per share. Revenues of US$17,054,000 did beat expectations by 5.2%, but it looks like a bit of a cold comfort. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Enanta Pharmaceuticals after the latest results.

View our latest analysis for Enanta Pharmaceuticals

Following the recent earnings report, the consensus from eight analysts covering Enanta Pharmaceuticals is for revenues of US$69.7m in 2024. This implies a small 4.4% decline in revenue compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$5.80. Before this earnings announcement, the analysts had been modelling revenues of US$68.8m and losses of US$5.21 per share in 2024. While this year's revenue estimates held steady, there was also a notable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

As a result, there was no major change to the consensus price target of US$20.38, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. 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. The most optimistic Enanta Pharmaceuticals analyst has a price target of US$35.00 per share, while the most pessimistic values it at US$11.00. 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.

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 would also point out that the forecast 8.5% annualised revenue decline to the end of 2024 is better than the historical trend, which saw revenues shrink 25% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 18% annually. So while a broad number of companies are forecast to grow, unfortunately Enanta Pharmaceuticals is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Enanta Pharmaceuticals. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Enanta Pharmaceuticals' revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$20.38, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Enanta Pharmaceuticals. Long-term earnings power is much more important than next year's profits. We have forecasts for Enanta Pharmaceuticals going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Enanta Pharmaceuticals has 1 warning sign we think you should be aware of.

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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.