Analysts Just Shaved Their Zevra Therapeutics, Inc. (NASDAQ:ZVRA) Forecasts Dramatically

Today is shaping up negative for Zevra Therapeutics, Inc. (NASDAQ:ZVRA) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon.

After this downgrade, Zevra Therapeutics' six analysts are now forecasting revenues of US$29m in 2024. This would be a credible 6.8% improvement in sales compared to the last 12 months. Losses are supposed to balloon 41% to US$1.55 per share. Yet before this consensus update, the analysts had been forecasting revenues of US$35m and losses of US$1.27 per share in 2024. Ergo, there's been a clear change in sentiment, with the analysts administering a notable cut to this year's revenue estimates, while at the same time increasing their loss per share forecasts.

View our latest analysis for Zevra Therapeutics

There was no major change to the consensus price target of US$19.00, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Zevra Therapeutics' revenue growth is expected to slow, with the forecast 6.8% annualised growth rate until the end of 2024 being well below the historical 18% 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 9.2% annually. Factoring in the forecast slowdown in growth, it seems obvious that Zevra Therapeutics is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses this year, suggesting all may not be well at Zevra Therapeutics. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Zevra Therapeutics' revenues are expected to grow slower than the wider market. The lack of change in the price target is puzzling in light of the downgrade but, with a serious decline expected this year, we wouldn't be surprised if investors were a bit wary of Zevra Therapeutics.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have estimates - from multiple Zevra Therapeutics analysts - going out to 2026, 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 downgrading 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.