Analyst Estimates: Here's What Brokers Think Of Exagen Inc. (NASDAQ:XGN) After Its Second-Quarter Report

Exagen Inc. (NASDAQ:XGN) just released its quarterly report and things are looking bullish. The results overall were pretty good, with revenues of US$15m exceeding expectations and statutory losses coming in at justUS$0.16 per share, some 52% below what the analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Exagen

Taking into account the latest results, Exagen's six analysts currently expect revenues in 2024 to be US$57.2m, approximately in line with the last 12 months. Losses are forecast to narrow 3.4% to US$0.96 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$55.8m and losses of US$1.18 per share in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a favorable reduction in loss per share in particular.

There was no major change to the consensus price target of US$6.25, perhaps suggesting that the analysts remain concerned about ongoing losses despite the improved earnings and revenue outlook. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Exagen analyst has a price target of US$8.00 per share, while the most pessimistic values it at US$5.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Exagen shareholders.

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. We would highlight that Exagen's revenue growth is expected to slow, with the forecast 2.0% annualised growth rate until the end of 2024 being well below the historical 7.2% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 18% annually. Factoring in the forecast slowdown in growth, it seems obvious that Exagen is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target held steady at US$6.25, with the latest estimates not enough to have an impact on their price targets.

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 forecasts for Exagen going out to 2026, and you can see them free on our platform here.

Even so, be aware that Exagen is showing 3 warning signs in our investment analysis , you should know about...

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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.

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