Industry Analysts Just Upgraded Their Xenon Pharmaceuticals Inc. (NASDAQ:XENE) Revenue Forecasts By 6.4%

Xenon Pharmaceuticals Inc. (NASDAQ:XENE) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's 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 consensus from Xenon Pharmaceuticals' seven analysts is for revenues of US$27m in 2021, which would reflect an uncomfortable 8.7% decline in sales compared to the last year of performance. Losses are supposed to balloon 48% to US$1.51 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$25m and losses of US$1.49 per share in 2021. So it looks like there's been no major change in sentiment in this consensus update, although the analysts have made a small lift in revenue forecasts.

See our latest analysis for Xenon Pharmaceuticals

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 11% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 52% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 14% per year. It's pretty clear that Xenon Pharmaceuticals' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Xenon Pharmaceuticals is moving incrementally towards profitability. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Xenon Pharmaceuticals.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Xenon Pharmaceuticals going out to 2025, 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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