Shareholders might have noticed that Liquidia Corporation (NASDAQ:LQDA) filed its quarterly result this time last week. The early response was not positive, with shares down 6.0% to US$5.31 in the past week. The results don't look great, especially considering that statutory losses grew 45% toUS$0.30 per share. Revenues of US$3.5m did beat expectations by 4.5%, but it looks like a bit of a cold comfort. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Liquidia from four analysts is for revenues of US$17.9m in 2022 which, if met, would be a huge 35% increase on its sales over the past 12 months. Per-share losses are expected to explode, reaching US$0.92 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$17.0m and losses of US$0.84 per share in 2022. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although there was a nice uplift to revenue, the consensus also made a pronounced increase to its losses per share forecasts.
The average price target rose 15% to US$11.75, even thoughthe analysts have been updating their forecasts to show higher revenues and higher forecast losses. 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 Liquidia, with the most bullish analyst valuing it at US$16.00 and the most bearish at US$6.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for 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. The analysts are definitely expecting Liquidia's growth to accelerate, with the forecast 49% annualised growth to the end of 2022 ranking favourably alongside historical growth of 29% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.0% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Liquidia is expected to grow much faster than its 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 revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
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 Liquidia analysts - going out to 2024, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Liquidia that you should be aware of.
Valuation is complex, but we're helping make it simple.
Find out whether Liquidia is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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.