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One thing we could say about the analysts on Theravance Biopharma, Inc. (NASDAQ:TBPH) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.
Following the downgrade, the latest consensus from Theravance Biopharma's four analysts is for revenues of US$71m in 2024, which would reflect a huge 30% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 50% to US$0.61 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$80m and losses of US$0.40 per share in 2024. 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 Theravance Biopharma
There was no major change to the consensus price target of US$14.50, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. For example, we noticed that Theravance Biopharma's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 23% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 4.8% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 8.3% annually. So it looks like Theravance Biopharma is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing to note from this downgrade is that the consensus increased its forecast losses next year, suggesting all may not be well at Theravance Biopharma. Unfortunately, analysts also downgraded their revenue estimates, although our data indicates revenues are expected to perform better 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 next year, we wouldn't be surprised if investors were a bit wary of Theravance Biopharma.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Theravance Biopharma going out to 2025, and you can see them free on our platform here.