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Vir Biotechnology, Inc. (NASDAQ:VIR) defied analyst predictions to release its annual results, which were ahead of market expectations. It looks like a positive result overall, with revenues of US$74m beating forecasts by 8.1%. Statutory losses of US$3.83 per share were 8.1% smaller than the analysts expected, likely helped along by the higher revenues. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Vir Biotechnology
After the latest results, the consensus from Vir Biotechnology's seven analysts is for revenues of US$21.7m in 2025, which would reflect a painful 71% decline in revenue compared to the last year of performance. Losses are forecast to narrow 2.6% to US$3.71 per share. Before this earnings announcement, the analysts had been modelling revenues of US$30.4m and losses of US$3.79 per share in 2025. We can see there's definitely been a change in sentiment in this update, with the analysts administering a meaningful downgrade to next year's revenue estimates, while at the same time reducing their loss estimates.
The consensus price target fell 34% to US$20.86, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Vir Biotechnology analyst has a price target of US$31.00 per share, while the most pessimistic values it at US$14.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 71% by the end of 2025. This indicates a significant reduction from annual growth of 4.1% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 20% per year. It's pretty clear that Vir Biotechnology's revenues are expected to perform substantially worse than the wider industry.