This Just In: Analysts Are Boosting Their Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) Outlook for This Year

Celebrations may be in order for Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.

After this upgrade, Recursion Pharmaceuticals' nine analysts are now forecasting revenues of US$129m in 2025. This would be a sizeable 119% improvement in sales compared to the last 12 months. Losses are expected to increase substantially, hitting US$1.37 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$84m and losses of US$1.71 per share in 2025. We can see there's definitely been a change in sentiment in this update, with the analysts administering a sizeable upgrade to this year's revenue estimates, while at the same time reducing their loss estimates.

Check out our latest analysis for Recursion Pharmaceuticals

Despite these upgrades, the analysts have not made any major changes to their price target of US$9.00, implying that their latest estimates don't have a long term impact on what they think the stock is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Recursion Pharmaceuticals' rate of growth is expected to accelerate meaningfully, with the forecast 119% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 47% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 20% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Recursion Pharmaceuticals 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 Recursion Pharmaceuticals' prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Some investors might be disappointed to see that the price target is unchanged, but we feel that improving fundamentals are usually a positive - assuming these forecasts are met! So Recursion Pharmaceuticals could be a good candidate for more research.

Analysts are clearly in love with Recursion Pharmaceuticals at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as major dilution from new stock issuance in the past year. For more information, you can click through to our platform to learn more about this and the 2 other risks 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 upgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.