Analysts Have Lowered Expectations For MeiraGTx Holdings plc (NASDAQ:MGTX) After Its Latest Results

Last week, you might have seen that MeiraGTx Holdings plc (NASDAQ:MGTX) released its third-quarter result to the market. The early response was not positive, with shares down 4.0% to US$6.64 in the past week. Revenues were 571% better than analyst models forecast, at US$11m. Perhaps unsurprisingly, statutory losses were also slightly larger than expected, at US$0.55 per share, reflecting the higher costs which were likely incurred in generating that revenue. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for MeiraGTx Holdings

Following the latest results, MeiraGTx Holdings' two analysts are now forecasting revenues of US$172.0m in 2025. This would be a substantial 1,135% improvement in revenue compared to the last 12 months. Statutory losses are forecast to balloon 44% to US$0.63 per share. Before this earnings report, the analysts had been forecasting revenues of US$242.6m and earnings per share (EPS) of US$1.01 in 2025. So we can see that the consensus has become notably more bearish on MeiraGTx Holdings' outlook following these results, with a large cut to next year's revenue estimates. Furthermore, they expect the business to be loss-making next year, compared to their previous calls for a profit.

The analysts lifted their price target 13% to US$23.25, implicitly signalling that lower earnings per share are not expected to have a longer-term impact on the stock's value.

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. For example, we noticed that MeiraGTx Holdings' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 6x growth to the end of 2025 on an annualised basis. That is well above its historical decline of 3.3% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 22% per year. So it looks like MeiraGTx Holdings is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest low-light for us was that the forecasts for MeiraGTx Holdings dropped from profits to a loss next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Before you take the next step you should know about the 3 warning signs for MeiraGTx Holdings (2 are potentially serious!) that we have uncovered.

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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.