Party Time: Brokers Just Made Major Increases To Their Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) Earnings Forecasts

Y-mAbs Therapeutics, Inc. (NASDAQ:YMAB) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Y-mAbs Therapeutics has also found favour with investors, with the stock up a whopping 30% to US$8.99 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the latest consensus from Y-mAbs Therapeutics' seven analysts is for revenues of US$84m in 2023, which would reflect a meaningful 12% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 46% to US$0.91. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$66m and losses of US$1.11 per share in 2023. We can see there's definitely been a change in sentiment in this update, with the analysts administering a sizeable upgrade to this year's revenue estimates, while at the same time reducing their loss estimates.

View our latest analysis for Y-mAbs Therapeutics

It will come as no surprise to learn that the analysts have increased their price target for Y-mAbs Therapeutics 14% to US$10.83 on the back of these upgrades. 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. Currently, the most bullish analyst values Y-mAbs Therapeutics at US$21.00 per share, while the most bearish prices it at US$5.00. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely differing views on what kind of performance this business can generate. As a result it might not be possible to derive much meaning from the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Y-mAbs Therapeutics' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Y-mAbs Therapeutics' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 70% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 19% annually. So it's pretty clear that, while Y-mAbs Therapeutics' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Y-mAbs Therapeutics is moving incrementally towards profitability. They also upgraded their revenue forecasts, although the latest estimates suggest that Y-mAbs Therapeutics will grow in line with the overall market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Y-mAbs Therapeutics could be worth investigating further.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Y-mAbs Therapeutics analysts - going out to 2025, and you can see them free on our platform here.

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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