Earnings Release: Here's Why Analysts Cut Their OptiNose, Inc. (NASDAQ:OPTN) Price Target To US$3.50

One of the biggest stories of last week was how OptiNose, Inc. (NASDAQ:OPTN) shares plunged 42% in the week since its latest quarterly results, closing yesterday at US$0.46. OptiNose's revenues suffered a miss, falling 11% short of forecasts, at US$20m. Statutory earnings per share (EPS) however performed much better, reaching break-even. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for OptiNose

Following the latest results, OptiNose's four analysts are now forecasting revenues of US$126.1m in 2025. This would be a sizeable 67% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 47% to US$0.11. Before this earnings announcement, the analysts had been modelling revenues of US$129.0m and losses of US$0.083 per share in 2025. So it's pretty clear the analysts have mixed opinions on OptiNose after this update; revenues were downgraded and per-share losses expected to increase.

The average price target fell 6.7% to US$3.50, implicitly signalling that lower earnings per share are a leading indicator for OptiNose's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on OptiNose, with the most bullish analyst valuing it at US$5.00 and the most bearish at US$3.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting OptiNose's growth to accelerate, with the forecast 50% annualised growth to the end of 2025 ranking favourably alongside historical growth of 15% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 10% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect OptiNose to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on OptiNose. Long-term earnings power is much more important than next year's profits. We have forecasts for OptiNose going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 4 warning signs for OptiNose (1 can't be ignored) 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.