Rainbows and Unicorns: Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS) Analysts Just Became A Lot More Optimistic

Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance. Investors have been pretty optimistic on Tarsus Pharmaceuticals too, with the stock up 17% to US$36.95 over the past week. It will be interesting to see if today's upgrade is enough to propel the stock even higher.

Following the upgrade, the current consensus from Tarsus Pharmaceuticals' six analysts is for revenues of US$98m in 2024 which - if met - would reflect a major 462% increase on its sales over the past 12 months. Losses are expected to increase substantially, hitting US$4.38 per share. However, before this estimates update, the consensus had been expecting revenues of US$62m and US$5.04 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

Check out our latest analysis for Tarsus Pharmaceuticals

It will come as no surprise to learn that the analysts have increased their price target for Tarsus Pharmaceuticals 13% to US$50.56 on the back of these upgrades.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Tarsus Pharmaceuticals' rate of growth is expected to accelerate meaningfully, with the forecast 5x annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 23% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.1% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Tarsus 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 Tarsus Pharmaceuticals' prospects. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Tarsus Pharmaceuticals.

Better yet, Tarsus Pharmaceuticals is expected to break-even soon - within the next few years - according to analyst forecasts, which would be a momentous event for shareholders. For more information, you can click through to our free platform to learn more about these forecasts.

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.