Theravance Biopharma, Inc. (NASDAQ:TBPH) Analysts Just Trimmed Their Revenue Forecasts By 27%

One thing we could say about the analysts on Theravance Biopharma, Inc. (NASDAQ:TBPH) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the latest downgrade, Theravance Biopharma's nine analysts currently expect revenues in 2021 to be US$65m, approximately in line with the last 12 months. Losses are presumed to reduce, shrinking 12% from last year to US$3.62. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$90m and losses of US$3.60 per share in 2021. 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 making no real change to the loss per share numbers.

View our latest analysis for Theravance Biopharma

The consensus price target was broadly unchanged at US$30.00, implying that the business is performing roughly in line with expectations, despite a downwards adjustment to forecast sales this year. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Theravance Biopharma, with the most bullish analyst valuing it at US$42.00 and the most bearish at US$20.00 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Theravance Biopharma's past performance and to peers in the same industry. We would highlight that Theravance Biopharma's revenue growth is expected to slow, with the forecast 4.0% annualised growth rate until the end of 2021 being well below the historical 20% 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) 3.7% annually. Factoring in the forecast slowdown in growth, it looks like Theravance Biopharma is forecast to grow at about the same rate as the wider industry.

The Bottom Line

Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn't be surprised if the market became a lot more cautious on Theravance Biopharma after today.

There might be good reason for analyst bearishness towards Theravance Biopharma, like dilutive stock issuance over the past year. For more information, you can click here to discover this and the 4 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.

When trading Theravance Biopharma or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.