Yahoo Finance Industry Analysts Just Upgraded Their Spero Therapeutics, Inc. (NASDAQ:SPRO) Revenue Forecasts By 40%
Shareholders in Spero Therapeutics, Inc. (NASDAQ:SPRO) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The analysts have sharply increased their revenue numbers, with a view that Spero Therapeutics will make substantially more sales than they'd previously expected. Investors have been pretty optimistic on Spero Therapeutics too, with the stock up 12% to US$1.62 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.
After the upgrade, the consensus from Spero Therapeutics' four analysts is for revenues of US$44m in 2023, which would reflect a chunky 17% decline in sales compared to the last year of performance. Losses are forecast to hold steady at around US$0.87. Yet before this consensus update, the analysts had been forecasting revenues of US$32m and losses of US$0.95 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.
See our latest analysis for Spero Therapeutics
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 17% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 33% 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 12% per year. It's pretty clear that Spero Therapeutics' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Spero Therapeutics' prospects. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Spero Therapeutics.
These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 3 potential warning signs with Spero Therapeutics, including major dilution from new stock issuance in the past year. You can learn more, and discover the 2 other warning signs we've identified, for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies 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.
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