Yahoo Finance Broker Revenue Forecasts For Denali Therapeutics Inc. (NASDAQ:DNLI) Are Surging Higher
Shareholders in Denali Therapeutics Inc. (NASDAQ:DNLI) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline.
Following the upgrade, the latest consensus from Denali Therapeutics' 13 analysts is for revenues of US$107m in 2022, which would reflect a huge 29% improvement in sales compared to the last 12 months. Losses are expected to increase substantially, hitting US$2.58 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$89m and losses of US$2.64 per share in 2022. So there's definitely been a change in sentiment in this update, with the analysts upgrading this year's revenue estimates, while at the same time holding losses per share steady.
Check out our latest analysis for Denali Therapeutics
There were no major changes to the US$75.42 consensus price target despite the higher revenue estimates, with the analysts seeming to believe that ongoing losses have a larger impact on the valuation than growing sales. 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. Currently, the most bullish analyst values Denali Therapeutics at US$111 per share, while the most bearish prices it at US$41.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Denali Therapeutics'historical trends, as the 41% annualised revenue growth to the end of 2022 is roughly in line with the 49% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 12% annually. So although Denali Therapeutics is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Denali Therapeutics is moving incrementally towards profitability. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Denali Therapeutics.
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 Denali Therapeutics analysts - going out to 2024, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
