Yahoo Finance Earnings Release: Here's Why Analysts Cut Their Marinus Pharmaceuticals, Inc. (NASDAQ:MRNS) Price Target To US$8.00
Marinus Pharmaceuticals, Inc. (NASDAQ:MRNS) just released its latest first-quarter report and things are not looking great. The numbers were weak, with revenues of US$7.7m coming in 16% short of analyst estimates. Statutory losses were US$0.68 per share, 3.0% larger than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for Marinus Pharmaceuticals
Following the latest results, Marinus Pharmaceuticals' eleven analysts are now forecasting revenues of US$39.4m in 2024. This would be a substantial 39% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 25% to US$1.98. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$41.1m and losses of US$2.23 per share in 2024. Although the revenue estimates have fallen somewhat, Marinus Pharmaceuticals'future looks a little different to the past, with a notable improvement in the loss per share forecasts in particular.
The consensus price target fell 8.9% to US$8.00, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Marinus Pharmaceuticals analyst has a price target of US$13.00 per share, while the most pessimistic values it at US$3.00. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Marinus Pharmaceuticals' past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Marinus Pharmaceuticals'historical trends, as the 55% annualised revenue growth to the end of 2024 is roughly in line with the 57% annual growth 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 revenues grow 9.4% per year. So although Marinus Pharmaceuticals is expected to maintain its revenue growth rate, it's definitely expected to grow faster 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. They also downgraded Marinus Pharmaceuticals' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, earnings are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Marinus Pharmaceuticals analysts - going out to 2026, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 6 warning signs for Marinus Pharmaceuticals (2 can't be ignored!) that you need to be mindful of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
