Party Time: Brokers Just Made Major Increases To Their Nurix Therapeutics, Inc. (NASDAQ:NRIX) Earnings Forecasts

Nurix Therapeutics, Inc. (NASDAQ:NRIX) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. Investors have been pretty optimistic on Nurix Therapeutics too, with the stock up 49% to US$13.28 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

After the upgrade, the nine analysts covering Nurix Therapeutics are now predicting revenues of US$60m in 2023. If met, this would reflect a sizeable 45% improvement in sales compared to the last 12 months. Losses are presumed to reduce, shrinking 19% from last year to US$3.06. However, before this estimates update, the consensus had been expecting revenues of US$45m and US$3.59 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for Nurix Therapeutics

Despite these upgrades, the analysts have not made any major changes to their price target of US$29.33, implying that their latest estimates don't have a long term impact on what they think the stock is worth. 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 Nurix Therapeutics, with the most bullish analyst valuing it at US$53.00 and the most bearish at US$11.00 per share. We would probably assign less value to the forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. With this in mind, we wouldn't rely too heavily on the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. The analysts are definitely expecting Nurix Therapeutics' growth to accelerate, with the forecast 64% annualised growth to the end of 2023 ranking favourably alongside historical growth of 31% per annum over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Nurix Therapeutics is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Nurix Therapeutics' prospects. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at Nurix Therapeutics.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Nurix Therapeutics analysts - going out to 2025, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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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.