The Acorda Therapeutics, Inc. (NASDAQ:ACOR) Analyst Just Boosted Their Forecasts By A Dazzling Amount
Shareholders in Acorda Therapeutics, Inc. (NASDAQ:ACOR) may be thrilled to learn that the covering analyst has just delivered a major upgrade to their near-term forecasts. The analyst greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.
After the upgrade, the consensus from Acorda Therapeutics' one analyst is for revenues of US$96m in 2021, which would reflect a substantial 37% decline in sales compared to the last year of performance. Losses are forecast to hold steady at around US$12.17. Yet before this consensus update, the analyst had been forecasting revenues of US$65m and losses of US$14.61 per share in 2021. So there's been quite a change-up of views after the recent consensus updates, with the analyst making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.
Check out our latest analysis for Acorda Therapeutics
The consensus price target rose 25% to US$5.00, with the analyst encouraged by the higher revenue and lower forecast losses for this year.
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. Over the past five years, revenues have declined around 21% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for an annualised 37% decline in revenue until the end of 2021. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 18% annually. So it's pretty clear that, while it does have declining revenues, the analyst also expect Acorda Therapeutics to suffer worse than the wider industry.
The Bottom Line
The most important thing here is that the analyst reduced their loss per share estimates for this year, reflecting increased optimism around Acorda Therapeutics' prospects. Pleasantly, the analyst also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Acorda Therapeutics.
The covering analyst is clearly in love with Acorda Therapeutics at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as a short cash runway. You can learn more, and discover the 3 other warning signs we've identified, for 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.
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.
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