Earnings Release: Here's Why Analysts Cut Their Alimera Sciences, Inc. (NASDAQ:ALIM) Price Target To US$13.50
Alimera Sciences, Inc. (NASDAQ:ALIM) investors will be delighted, with the company turning in some strong numbers with its latest results. The results overall were pretty good, with revenues of US$12m exceeding expectations and statutory losses coming in at justUS$0.12 per share, some 73% below what 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for Alimera Sciences
Following the latest results, Alimera Sciences' four analysts are now forecasting revenues of US$62.2m in 2021. This would be a notable 14% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 23% to US$0.59. Before this latest report, the consensus had been expecting revenues of US$62.5m and US$0.50 per share in losses. While next year's revenue estimates held steady, there was also a loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
The consensus price target fell 30% to US$13.50per share, with the analysts clearly concerned by ballooning losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Alimera Sciences at US$18.00 per share, while the most bearish prices it at US$10.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Alimera Sciences' past performance and to peers in the same industry. It's pretty clear that there is an expectation that Alimera Sciences' revenue growth will slow down substantially, with revenues next year expected to grow 14%, compared to a historical growth rate of 18% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.7% next year. So it's pretty clear that, while Alimera Sciences' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Alimera Sciences. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Alimera Sciences going out to 2022, 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 3 warning signs for Alimera Sciences that you need to be mindful of.
This article by Simply Wall St is general in nature. 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.
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