Analysts Are Upgrading Opus Genetics, Inc. (NASDAQ:IRD) After Its Latest Results

Investors in Opus Genetics, Inc. (NASDAQ:IRD) had a good week, as its shares rose 7.4% to close at US$1.02 following the release of its quarterly results. Revenues of US$4.4m crushed expectations, although expenses increased commensurately, with statutory losses hitting US$0.24 per share, -17% above what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the current consensus from Opus Genetics' three analysts is for revenues of US$15.4m in 2025. This would reflect a meaningful 13% increase on its revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 39% to US$0.78. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$13.3m and losses of US$0.90 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

See our latest analysis for Opus Genetics

The consensus price target fell 31%, to US$7.33, suggesting that the analysts remain pessimistic on the company, despite the improved earnings and revenue outlook. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Opus Genetics analyst has a price target of US$8.00 per share, while the most pessimistic values it at US$6.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

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. We would highlight that Opus Genetics' revenue growth is expected to slow, with the forecast 17% annualised growth rate until the end of 2025 being well below the historical 44% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 17% annually. Factoring in the forecast slowdown in growth, it looks like Opus Genetics is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Opus Genetics analysts - going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 4 warning signs for Opus Genetics (of which 1 makes us a bit uncomfortable!) you should know about.

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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.