These Analysts Think EyePoint Pharmaceuticals, Inc.'s (NASDAQ:EYPT) Sales Are Under Threat

Today is shaping up negative for EyePoint Pharmaceuticals, Inc. (NASDAQ:EYPT) shareholders, with the analysts delivering a substantial negative revision to next year's forecasts. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following this downgrade, EyePoint Pharmaceuticals' nine analysts are forecasting 2024 revenues to be US$43m, approximately in line with the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 21% to US$1.69. Yet before this consensus update, the analysts had been forecasting revenues of US$48m and losses of US$1.66 per share in 2024. 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 making no real change to the loss per share numbers.

See our latest analysis for EyePoint Pharmaceuticals

Analysts lifted their price target 21% to US$42.75 per share, with reduced revenue estimates seemingly not expected to have a long-term impact on the intrinsic value of the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that EyePoint Pharmaceuticals' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 0.6% growth on an annualised basis. This is compared to a historical growth rate of 28% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 8.6% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than EyePoint Pharmaceuticals.

The Bottom Line

Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that EyePoint Pharmaceuticals' revenues are expected to grow slower than the wider market. There was also an increase in the price target, suggesting that there is more optimism baked into the forecasts than there was previously. Given the stark change in sentiment, we'd understand if investors became more cautious on EyePoint Pharmaceuticals after today.

There might be good reason for analyst bearishness towards EyePoint Pharmaceuticals, like recent substantial insider selling. Learn more, and discover the 3 other flags we've identified, for 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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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.