Stock Analysis

NGM Biopharmaceuticals, Inc. (NASDAQ:NGM) Annual Results Just Came Out: Here's What Analysts Are Forecasting For This Year

  •  Updated
NasdaqGS:NGM
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Last week, you might have seen that NGM Biopharmaceuticals, Inc. (NASDAQ:NGM) released its full-year result to the market. The early response was not positive, with shares down 3.4% to US$25.81 in the past week. The results look positive overall; while revenues of US$87m were in line with analyst predictions, statutory losses were 9.5% smaller than expected, with NGM Biopharmaceuticals losing US$1.50 per share. 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. 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 NGM Biopharmaceuticals

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NasdaqGS:NGM Earnings and Revenue Growth March 6th 2021

Following the latest results, NGM Biopharmaceuticals' seven analysts are now forecasting revenues of US$97.4m in 2021. This would be a meaningful 12% improvement in sales compared to the last 12 months. Losses are forecast to balloon 32% to US$1.97 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$97.4m and losses of US$1.97 per share in 2021.

The consensus price target was unchanged at US$40.00, suggesting that the business - losses and all - is executing in line with estimates. 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. Currently, the most bullish analyst values NGM Biopharmaceuticals at US$50.00 per share, while the most bearish prices it at US$30.00. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that NGM Biopharmaceuticals' rate of growth is expected to accelerate meaningfully, with the forecast 12% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 6.6% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.8% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that NGM Biopharmaceuticals is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are 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. At Simply Wall St, we have a full range of analyst estimates for NGM Biopharmaceuticals going out to 2025, 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 NGM Biopharmaceuticals (1 makes us a bit uncomfortable) you should be aware of.

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