Analyst Estimates: Here's What Brokers Think Of OmniAb, Inc. (NASDAQ:OABI) After Its Second-Quarter Report

Investors in OmniAb, Inc. (NASDAQ:OABI) had a good week, as its shares rose 3.1% to close at US$1.97 following the release of its second-quarter results. Revenues fell badly short of expectations, with revenue of US$3.9m being some 27% below what the analysts had forecast. Statutory losses were in line with forecasts, with OmniAb losing US$0.15 a share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Following the recent earnings report, the consensus from eight analysts covering OmniAb is for revenues of US$22.0m in 2025. This implies a perceptible 4.4% decline in revenue compared to the last 12 months. Per-share losses are supposed to see a sharp uptick, reaching US$0.58. Before this latest report, the consensus had been expecting revenues of US$23.0m and US$0.59 per share in losses.

See our latest analysis for OmniAb

There was no real change to the average price target of US$8.13, suggesting that the revisions to revenue estimates are not expected to have a long-term impact on OmniAb's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic OmniAb analyst has a price target of US$11.00 per share, while the most pessimistic values it at US$3.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying 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. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2025 compared to the historical decline of 31% per annum over the past three years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 5.9% annually. So while a broad number of companies are forecast to grow, unfortunately OmniAb is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.

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. We have estimates - from multiple OmniAb analysts - going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for OmniAb you should be aware of.

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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.