Shareholders in Precigen, Inc. (NASDAQ:PGEN) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with analysts now much more optimistic on its sales pipeline. Investors have been pretty optimistic on Precigen too, with the stock up 15% to US$6.14 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 six analysts covering Precigen are now predicting revenues of US$107m in 2021. If met, this would reflect a notable 9.2% improvement in sales compared to the last 12 months. Losses are expected to be contained, narrowing 18% from last year to US$0.49. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$86m and losses of US$0.49 per share in 2021. So there's definitely been a change in sentiment in this update, with the analysts upgrading this year's revenue estimates, while at the same time holding losses per share steady.
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. For example, we noticed that Precigen's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 19% growth to the end of 2021 on an annualised basis. That is well above its historical decline of 17% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 10% annually. Not only are Precigen's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider 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 Precigen's prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Precigen.
Analysts are definitely bullish on Precigen, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including dilutive stock issuance over the past year. You can learn more, and discover the 2 other concerns we've identified, for 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.
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