Analysts Have Lowered Expectations For Precision BioSciences, Inc. (NASDAQ:DTIL) After Its Latest Results
Precision BioSciences, Inc. (NASDAQ:DTIL) just released its latest second-quarter report and things are not looking great. It was not a great statutory result, with revenues coming in 100% lower than the analysts predicted. Unsurprisingly, earnings also fell seriously short of forecasts, turning into a per-share loss of US$1.26. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
After the latest results, the consensus from Precision BioSciences' five analysts is for revenues of US$12.6m in 2026, which would reflect a sizeable 72% decline in revenue compared to the last year of performance. Per-share losses are expected to explode, reaching US$3.54 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$18.8m and losses of US$2.77 per share in 2026. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.
Check out our latest analysis for Precision BioSciences
There was no major change to the consensus price target of US$29.40, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Precision BioSciences, with the most bullish analyst valuing it at US$60.00 and the most bearish at US$18.00 per share. 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.
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. One more thing stood out to us about these estimates, and it's the idea that Precision BioSciences' decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 92% to the end of 2026. This tops off a historical decline of 21% a year 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 revenue grow 23% per year. So while a broad number of companies are forecast to grow, unfortunately Precision BioSciences is expected to see its revenue affected worse than other companies in the industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. 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. The consensus price target held steady at US$29.40, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Precision BioSciences going out to 2028, 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 2 warning signs for Precision BioSciences (1 is potentially serious!) that you need to be mindful 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.