Broker Revenue Forecasts For Scholar Rock Holding Corporation (NASDAQ:SRRK) Are Surging Higher

Shareholders in Scholar Rock Holding Corporation (NASDAQ:SRRK) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

After the upgrade, the six analysts covering Scholar Rock Holding are now predicting revenues of US$25m in 2022. If met, this would reflect a substantial 37% improvement in sales compared to the last 12 months. Losses are expected to increase substantially, hitting US$4.16 per share. However, before this estimates update, the consensus had been expecting revenues of US$21m and US$4.18 per share in losses. So there's been quite a change-up of views after the recent consensus updates, withthe analysts noticeably increasing their revenue forecasts while also expecting losses per share to hold steady.

View our latest analysis for Scholar Rock Holding

The consensus price target held steady at US$50.60 despite the upgrade to revenue forecasts and ongoing losses. Analysts seem to think the business is otherwise performing roughly in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Scholar Rock Holding, with the most bullish analyst valuing it at US$74.00 and the most bearish at US$28.00 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

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 Scholar Rock Holding's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 37% growth on an annualised basis. This is compared to a historical growth rate of 55% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% annually. So it's pretty clear that, while Scholar Rock Holding's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Scholar Rock Holding's prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Scholar Rock Holding.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Scholar Rock Holding analysts - going out to 2024, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.