Editas Medicine, Inc. (NASDAQ:EDIT) just released its quarterly report and things are looking bullish. Results clearly exceeded expectations, with a substantial revenue beat leading to smaller losses in what looks like a definite win for investors. Revenues were US$10m and the statutory loss per share was US$0.15, smaller than the analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. 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 consensus from Editas Medicine's ten analysts is for revenues of US$19.0m in 2027, which would reflect a concerning 62% decline in revenue compared to the last year of performance. Losses are forecast to balloon 48% to US$0.69 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$19.5m and losses of US$0.72 per share in 2027. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for next year.
Check out our latest analysis for Editas Medicine
There was no major change to the US$6.10average price target, suggesting that the adjustments to revenue and earnings are not expected to have a long-term impact on the business. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Editas Medicine analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$1.00. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. 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.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 54% by the end of 2027. This indicates a significant reduction from annual growth of 13% 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 22% per year. It's pretty clear that Editas Medicine's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. With that said, earnings are more important to the long-term value of the business. The consensus price target held steady at US$6.10, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Editas Medicine analysts - going out to 2028, and you can see them free on our platform here.
Before you take the next step you should know about the 4 warning signs for Editas Medicine (2 shouldn't be ignored!) that we have uncovered.
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