Kiniksa Pharmaceuticals, Ltd. Just Reported A Surprise Profit And Analysts Updated Their Estimates

It's been a good week for Kiniksa Pharmaceuticals, Ltd. (NASDAQ:KNSA) shareholders, because the company has just released its latest annual results, and the shares gained 5.7% to US$21.14. It was overall a positive result, with revenues beating expectations by 4.2% to hit US$270m. Kiniksa Pharmaceuticals also reported a statutory profit of US$0.20, which was a nice improvement from the loss that the analysts were predicting. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Kiniksa Pharmaceuticals

After the latest results, the three analysts covering Kiniksa Pharmaceuticals are now predicting revenues of US$376.5m in 2024. If met, this would reflect a substantial 39% improvement in revenue compared to the last 12 months. The company is forecast to report a statutory loss of US$0.019 in 2024, a sharp decline from a profit over the last year. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$378.9m and losses of US$0.15 per share in 2024. Although the revenue estimates have not really changed Kiniksa Pharmaceuticals'future looks a little different to the past, with a very favorable reduction to the loss per share forecasts in particular.

There's been no major changes to the consensus price target of US$27.40, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. 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. There are some variant perceptions on Kiniksa Pharmaceuticals, with the most bullish analyst valuing it at US$32.00 and the most bearish at US$24.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Kiniksa Pharmaceuticals' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 39% growth on an annualised basis. This is compared to a historical growth rate of 77% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 18% per year. So it's pretty clear that, while Kiniksa Pharmaceuticals' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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 Kiniksa Pharmaceuticals analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Kiniksa Pharmaceuticals .

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.