Results: Science 37 Holdings, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates

It's been a sad week for Science 37 Holdings, Inc. (NASDAQ:SNCE), who've watched their investment drop 20% to US$3.03 in the week since the company reported its first-quarter result. Revenues beat expectations by 24%, and sales of US$19m were sufficient to generate a statutory profit of US$0.35 - a pleasant surprise given that the analysts were forecasting a loss! 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Science 37 Holdings

Taking into account the latest results, the current consensus from Science 37 Holdings' four analysts is for revenues of US$92.4m in 2022, which would reflect a major 40% increase on its sales over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 35% to US$0.24. Before this latest report, the consensus had been expecting revenues of US$91.1m and US$0.86 per share in losses. Although the revenue estimates have not really changed Science 37 Holdings'future looks a little different to the past, with a very promising decrease in the loss per share forecasts in particular.

Even with the lower forecast losses, the analysts lowered their valuations, with the average price target falling 38% to US$11.33. It looks likethe analysts have become less optimistic about the overall business. 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. Currently, the most bullish analyst values Science 37 Holdings at US$12.00 per share, while the most bearish prices it at US$10.00. This is a very narrow spread of estimates, implying either that Science 37 Holdings is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Science 37 Holdings' revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 57% growth on an annualised basis. This is compared to a historical growth rate of 99% over the past year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.9% per year. Even after the forecast slowdown in growth, it seems obvious that Science 37 Holdings is also expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Happily, there were no major changes to revenue forecasts, with the business still expected to 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.

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 Science 37 Holdings analysts - going out to 2024, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Science 37 Holdings that 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.