Some Seres Therapeutics, Inc. (NASDAQ:MCRB) Analysts Just Made A Major Cut To Next Year's Estimates

The latest analyst coverage could presage a bad day for Seres Therapeutics, Inc. (NASDAQ:MCRB), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the latest downgrade, the current consensus, from the eight analysts covering Seres Therapeutics, is for revenues of US$29m in 2022, which would reflect a substantial 82% reduction in Seres Therapeutics' sales over the past 12 months. Losses are supposed to balloon 519% to US$2.28 per share. However, before this estimates update, the consensus had been expecting revenues of US$61m and US$1.80 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

Check out our latest analysis for Seres Therapeutics

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 82% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 23% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 12% per year. It's pretty clear that Seres Therapeutics' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that analysts increased their loss per share estimates for this year. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. We wouldn't be surprised to find shareholders feeling a bit shell-shocked, after these downgrades. It looks like analysts have become a lot more bearish on Seres Therapeutics, and their negativity could be grounds for caution.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Seres Therapeutics analysts - going out to 2024, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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