Celebrations may be appropriate for XOMA Royalty Corporation (NASDAQ:XOMA) shareholders, with analysts making significant upward revisions to their statutory estimates for the company. Consensus estimates suggest investors can expect sharply increased statutory revenue and earnings per share, with analysts modeling real improvement in business performance. XOMA Royalty has also resonated with investors, with the stock up a remarkable 18% to $28.13 over the past week. Could this upgrade be enough to push the stock even higher?
Following the upgrade, the latest consensus among three analysts for XOMA Royalty is for revenues of $26 million in 2024. If achieved, this would be a notable 70% increase on the past 12 months’ revenue. Losses are forecast to narrow significantly, shrinking 94% to $0.12 per share. However, prior to the latest estimates, analysts had been forecasting revenues of $21 million and losses of $1.89 per share in 2024. So, following the latest consensus updates, there has been quite a change in views: analysts have significantly increased their revenue forecasts while reducing the estimated loss as the business approaches breakeven.
Check out our latest analysis for XOMA Royalty
The consensus price target rose 43% to $83.00, with analysts encouraged by higher revenue and lower forecast losses for this year.
Now, looking at the bigger picture, one of the ways we can understand these forecasts is to compare them against both past performance and industry growth estimates. For example, we found that XOMA Royalty’s growth pace is expected to accelerate significantly. Revenue is forecast to grow at a 190% annualized rate through the end of 2024. That’s well above the historical decline of 8.3% per year over the past five years. Compare this to analyst estimates for the wider industry, which suggest that (in total) industry revenues are expected to grow at a 23% annualized rate. Not only are XOMA Royalty’s revenues expected to improve, analysts also seem to expect the company to grow faster than the industry as a whole.
The conclusion
Most importantly, analysts have cut their loss per share estimates for this year, reflecting increased optimism about XOMA Royalty’s prospects. Fortunately, analysts have also upgraded their revenue estimates, and our data suggests that revenues are expected to outperform the broader market. With a significant increase in expectations and a rising price target, it might be time to take another look at XOMA Royalty.
Even better, according to analyst forecasts, XOMA Royalty is expected to break even in the next few years, which would be a significant event for shareholders. You can find more information about these forecasts on our free platform.
Of course, you can see the company management invest large sums in a stock can be just as useful as knowing whether analysts are improving their estimates. So you can also free List of stocks with high insider ownership.
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