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Results: Moderna, Inc. Confounded Analyst Expectations With A Surprise Profit
The investors in Moderna, Inc.'s (NASDAQ:MRNA) will be rubbing their hands together with glee today, after the share price leapt 22% to US$269 in the week following its third-quarter results. Revenues of 47% beat expectations by US$1.3b and was sufficient to generate a statutory profit of US$0.38 - a pleasant surprise given that the analysts were forecasting a loss! The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
After the latest results, the 20 analysts covering Moderna are now predicting revenues of US$2.65b in 2027. If met, this would reflect a modest 5.1% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 36% to US$4.44. Before this latest report, the consensus had been expecting revenues of US$2.44b and US$4.90 per share in losses. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for both revenues and losses per share.
Check out our latest analysis for Moderna
The consensus price target rose 12% to US$154, with the analysts encouraged by the higher revenue and lower forecast losses for next year. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Moderna at US$270 per share, while the most bearish prices it at US$45.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
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 Moderna is forecast to grow faster in the future than it has in the past, with revenues expected to display 4.0% annualised growth until the end of 2027. If achieved, this would be a much better result than the 46% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 22% per year. So although Moderna's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Moderna going out to 2028, and you can see them free on our platform here..
Even so, be aware that Moderna is showing 1 warning sign in our investment analysis , you should know about...
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