It's been a good week for Dynavax Technologies Corporation (NASDAQ:DVAX) shareholders, because the company has just released its latest yearly results, and the shares gained 2.7% to US$12.75. Revenues of US$232m arrived in line with expectations, although statutory losses per share were US$0.05, an impressive 62% smaller than what broker models predicted. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Dynavax Technologies after the latest results.
Taking into account the latest results, the consensus forecast from Dynavax Technologies' four analysts is for revenues of US$294.5m in 2024. This reflects a substantial 27% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Dynavax Technologies forecast to report a statutory profit of US$0.12 per share. Before this earnings report, the analysts had been forecasting revenues of US$290.6m and earnings per share (EPS) of US$0.19 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$24.67, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Dynavax Technologies, with the most bullish analyst valuing it at US$29.00 and the most bearish at US$20.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Dynavax Technologies' revenue growth is expected to slow, with the forecast 27% annualised growth rate until the end of 2024 being well below the historical 50% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 17% per year. So it's pretty clear that, while Dynavax Technologies' 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 take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$24.67, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Dynavax Technologies going out to 2026, and you can see them free on our platform here..
However, before you get too enthused, we've discovered 1 warning sign for Dynavax Technologies that 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.