Analysts Are More Bearish On Revance Therapeutics, Inc. (NASDAQ:RVNC) Than They Used To Be

The analysts covering Revance Therapeutics, Inc. (NASDAQ:RVNC) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Revenue and earnings per share (EPS) forecasts were both revised downwards, with analysts seeing grey clouds on the horizon.

Following the downgrade, the most recent consensus for Revance Therapeutics from its eleven analysts is for revenues of US$335m in 2024 which, if met, would be a major 56% increase on its sales over the past 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 56% to US$2.06. Yet before this consensus update, the analysts had been forecasting revenues of US$384m and losses of US$1.82 per share in 2024. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

Check out our latest analysis for Revance Therapeutics

The consensus price target fell 16% to US$30.27, implicitly signalling that lower earnings per share are a leading indicator for Revance Therapeutics' valuation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Revance Therapeutics' revenue growth is expected to slow, with the forecast 43% annualised growth rate until the end of 2024 being well below the historical 68% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 8.3% per year. So it's pretty clear that, while Revance Therapeutics' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses next year, suggesting all may not be well at Revance Therapeutics. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of Revance Therapeutics.

That said, the analysts might have good reason to be negative on Revance Therapeutics, given dilutive stock issuance over the past year. For more information, you can click here to discover this and the 2 other concerns we've identified.

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

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