US$12.60: That's What Analysts Think Fennec Pharmaceuticals Inc. (NASDAQ:FENC) Is Worth After Its Latest Results

Shareholders might have noticed that Fennec Pharmaceuticals Inc. (NASDAQ:FENC) filed its full-year result this time last week. The early response was not positive, with shares down 3.7% to US$6.50 in the past week. Fennec Pharmaceuticals' revenues suffered a miss, falling 15% short of forecasts, at US$48m. Statutory earnings per share (EPS) however performed much better, reaching break-even. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Fennec Pharmaceuticals

Following last week's earnings report, Fennec Pharmaceuticals' five analysts are forecasting 2025 revenues to be US$47.4m, approximately in line with the last 12 months. Fennec Pharmaceuticals is also expected to turn profitable, with statutory earnings of US$0.066 per share. Before this latest report, the consensus had been expecting revenues of US$48.9m and US$0.034 per share in losses. While we note the minor downgrade to to the revenue outlook, the analysts are now also predicting for the business to become profitable next year - sooner than previously forecast - which looks like a pretty clear lift in expectations.

The consensus price target fell 20% to US$12.60, with the analysts signalling that the weaker revenue outlook was a more powerful indicator than the upgraded EPS forecasts. 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 Fennec Pharmaceuticals at US$15.00 per share, while the most bearish prices it at US$10.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We would highlight that revenue is expected to reverse, with a forecast 0.2% annualised decline to the end of 2025. That is a notable change from historical growth of 85% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 20% annually for the foreseeable future. It's pretty clear that Fennec Pharmaceuticals' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that there's been a clear step-change in belief around the business' prospects, with the analysts now expecting Fennec Pharmaceuticals to become profitable next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Fennec Pharmaceuticals' future valuation.

Following on from that line of thought, we think that 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 Fennec Pharmaceuticals going out to 2027, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Fennec Pharmaceuticals (including 1 which is a bit concerning) .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.