HOOKIPA Pharma Inc. (NASDAQ:HOOK) Analysts Just Slashed This Year's Revenue Estimates By 17%

One thing we could say about the analysts on HOOKIPA Pharma Inc. (NASDAQ:HOOK) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well. Surprisingly the share price has been buoyant, rising 20% to US$1.86 in the past 7 days. Whether the downgrade will have a negative impact on demand for shares is yet to be seen.

Following the downgrade, the consensus from six analysts covering HOOKIPA Pharma is for revenues of US$15m in 2023, implying a measurable 3.5% decline in sales compared to the last 12 months. Before the latest update, the analysts were foreseeing US$18m of revenue in 2023. The consensus view seems to have become more pessimistic on HOOKIPA Pharma, noting the measurable cut to revenue estimates in this update.

See our latest analysis for HOOKIPA Pharma

We'd point out that there was no major changes to their price target of US$4.64, suggesting the latest estimates were not enough to shift their view on the value of the business. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on HOOKIPA Pharma, with the most bullish analyst valuing it at US$8.00 and the most bearish at US$0.50 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how think this business will perform. With this in mind, we wouldn't rely too heavily on the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on 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. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2023 compared to the historical decline of 8.3% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 19% per year. So while a broad number of companies are forecast to grow, unfortunately HOOKIPA Pharma is expected to see its sales affected worse than other companies in the industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for HOOKIPA Pharma this year. They also expect company revenue to perform worse than the wider market. Overall, given the drastic downgrade to this year's forecasts, we'd be feeling a little more wary of HOOKIPA Pharma going forwards.

Thirsting for more data? We have estimates for HOOKIPA Pharma from its six analysts out until 2025, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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