One thing we could say about the analysts on CRISPR Therapeutics AG (NASDAQ:CRSP) – they aren’t optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.
Following the downgrade, the latest consensus from CRISPR Therapeutics’ 18 analysts is for revenues of US$133m in 2027, which would reflect a sizeable 430% improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 24% to US$3.57. Yet before this consensus update, the analysts had been forecasting revenues of US$154m and losses of US$3.30 per share in 2027. Ergo, there’s been a clear change in sentiment, with the analysts administering a notable cut to next year’s revenue estimates, while at the same time increasing their loss per share forecasts.
View our latest analysis for CRISPR Therapeutics
The consensus price target was broadly unchanged at US$85.42, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the valuation.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing stands out from these estimates, which is that CRISPR Therapeutics is forecast to grow faster in the future than it has in the past, with revenues expected to display 280% annualised growth until the end of 2027. If achieved, this would be a much better result than the 60% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 22% per year. So it looks like CRISPR Therapeutics is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing to take away is that analysts increased their loss per share estimates for next year. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. Often, one downgrade can set off a daisy-chain of cuts, especially if an industry is in decline. So we wouldn’t be surprised if the market became a lot more cautious on CRISPR Therapeutics after today.
With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. We have estimates – from multiple CRISPR Therapeutics analysts – going out to 2028, 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 backed by insiders.
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