Yahoo Finance Earnings Update: Amarin Corporation plc (NASDAQ:AMRN) Just Reported And Analysts Are Trimming Their Forecasts
It's been a sad week for Amarin Corporation plc (NASDAQ:AMRN), who've watched their investment drop 11% to US$1.06 in the week since the company reported its full-year result. Revenue hit US$307m in line with forecasts, although the company reported a statutory loss per share of US$0.15 that was somewhat smaller than the analysts expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. 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 Amarin
Taking into account the latest results, the four analysts covering Amarin provided consensus estimates of US$213.6m revenue in 2024, which would reflect a concerning 30% decline over the past 12 months. Losses are forecast to balloon 26% to US$0.18 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$226.1m and losses of US$0.15 per share in 2024. While this year's revenue estimates dropped there was also a regrettable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
The average price target fell 56% to US$1.08, implicitly signalling that lower earnings per share are a leading indicator for Amarin's valuation. 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. There are some variant perceptions on Amarin, with the most bullish analyst valuing it at US$2.00 and the most bearish at US$1.00 per share. This is a fairly broad spread of estimates, suggesting that 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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 30% by the end of 2024. This indicates a significant reduction from annual growth of 0.4% 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 17% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Amarin is expected to lag the wider industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Amarin. 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. 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 estimates - from multiple Amarin analysts - going out to 2026, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 1 warning sign for Amarin you should be aware of.
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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.
