Earnings Beat: LENZ Therapeutics, Inc. (NASDAQ:LENZ) Just Beat Analyst Forecasts, And Analysts Have Been Lifting Their Forecasts

LENZ Therapeutics, Inc. (NASDAQ:LENZ) just released its third-quarter report and things are looking bullish. Results clearly exceeded expectations, with a substantial revenue beat leading to smaller losses in what looks like a definite win for investors. Revenues were US$13m and the statutory loss per share was US$0.59, smaller than the analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the consensus forecast from LENZ Therapeutics' seven analysts is for revenues of US$53.4m in 2026. This reflects a huge 205% improvement in revenue compared to the last 12 months. Losses are expected to increase slightly, to US$2.41 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$49.7m and losses of US$2.33 per share in 2026. So it's pretty clear consensus is mixed on LENZ Therapeutics after the new consensus numbers; while the analysts lifted revenue numbers, they also administered a pronounced increase to per-share loss expectations.

See our latest analysis for LENZ Therapeutics

There was no major change to the consensus price target of US$53.50, with growing revenues seemingly enough to offset the concern of growing losses. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on LENZ Therapeutics, with the most bullish analyst valuing it at US$62.00 and the most bearish at US$36.00 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. The analysts are definitely expecting LENZ Therapeutics' growth to accelerate, with the forecast 144% annualised growth to the end of 2026 ranking favourably alongside historical growth of 6.5% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.0% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect LENZ Therapeutics to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. The consensus price target held steady at US$53.50, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on LENZ Therapeutics. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for LENZ Therapeutics going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with LENZ Therapeutics , and understanding this should be part of your investment process.

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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.