Industry Analysts Just Upgraded Their Arvinas, Inc. (NASDAQ:ARVN) Revenue Forecasts By 25%
Arvinas, Inc. (NASDAQ:ARVN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts have sharply increased their revenue numbers, with a view that Arvinas will make substantially more sales than they'd previously expected.
Following the upgrade, the latest consensus from Arvinas' nine analysts is for revenues of US$22m in 2021, which would reflect an okay 4.2% improvement in sales compared to the last 12 months. Losses are expected to increase slightly, to US$3.48 per share. Yet before this consensus update, the analysts had been forecasting revenues of US$18m and losses of US$3.57 per share in 2021. 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.
Check out our latest analysis for Arvinas
There was no major change to the consensus price target of US$113, perhaps suggesting that the analysts remain concerned about ongoing losses despite the improved earnings and revenue outlook. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Arvinas at US$150 per share, while the most bearish prices it at US$94.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Arvinas' revenue growth is expected to slow, with the forecast 5.7% annualised growth rate until the end of 2021 being well below the historical 31% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.1% annually. Even after the forecast slowdown in growth, it seems obvious that Arvinas is also expected to grow faster than the wider industry.
The Bottom Line
The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Arvinas is moving incrementally towards profitability. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Arvinas.
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 Arvinas 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.
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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