Shareholders might have noticed that Keymed Biosciences Inc. (HKG:2162) filed its annual result this time last week. The early response was not positive, with shares down 6.6% to HK$33.90 in the past week. It was a pretty bad result overall; while revenues were in line with expectations at CN¥354m, statutory losses exploded to CN¥1.37 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Taking into account the latest results, the nine analysts covering Keymed Biosciences provided consensus estimates of CN¥286.1m revenue in 2024, which would reflect a definite 19% decline over the past 12 months. Losses are forecast to balloon 49% to CN¥1.94 per share. Before this earnings announcement, the analysts had been modelling revenues of CN¥275.7m and losses of CN¥1.90 per share in 2024. So it's pretty clear consensus is mixed on Keymed Biosciences after the new consensus numbers; while the analysts lifted revenue numbers, they also administered a moderate increase in per-share loss expectations.

It will come as no surprise that expanding losses caused the consensus price target to fall 11% to HK$69.56with the analysts implicitly ranking ongoing losses as a greater concern than growing revenues. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Keymed Biosciences at HK$79.22 per share, while the most bearish prices it at HK$52.76. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Keymed Biosciences shareholders.

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 19% by the end of 2024. This indicates a significant reduction from annual growth of 79% over the last three years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 26% annually for the foreseeable future. It's pretty clear that Keymed Biosciences' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Keymed Biosciences' future valuation.

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. We have forecasts for Keymed Biosciences going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for Keymed Biosciences (of which 1 is a bit unpleasant!) you should know about.

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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.