Celebrations may be in order for Keymed Biosciences Inc. (HKG:2162) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts have sharply increased their revenue numbers, with a view that Keymed Biosciences will make substantially more sales than they'd previously expected.

After the upgrade, the ten analysts covering Keymed Biosciences are now predicting revenues of CN¥141m in 2024. If met, this would reflect a sizeable 72% improvement in sales compared to the last 12 months. Losses are forecast to hold steady at around CN¥2.72 per share. However, before this estimates update, the consensus had been expecting revenues of CN¥127m and CN¥2.77 per share in losses. So there's definitely been a change in sentiment in this update, with the analysts upgrading this year's revenue estimates, while at the same time holding losses per share steady.

There were no major changes to the CN¥51.28 consensus price target despite the higher revenue estimates, with the analysts seeming to believe that ongoing losses have a larger impact on the valuation than growing sales. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Keymed Biosciences at CN¥56.67 per share, while the most bearish prices it at CN¥45.46. Still, with such a tight range of estimates, it suggests the analysts have a pretty good idea of what they think the company is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Keymed Biosciences' past performance and to peers in the same industry. The analysts are definitely expecting Keymed Biosciences' growth to accelerate, with the forecast 72% annualised growth to the end of 2024 ranking favourably alongside historical growth of 38% per annum over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 29% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Keymed Biosciences to grow faster 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 Keymed Biosciences' prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Keymed Biosciences.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Keymed Biosciences analysts - going out to 2026, and you can see them 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 backed by insiders.

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