It's shaping up to be a tough period for OmniAb, Inc. (NASDAQ:OABI), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. OmniAb missed analyst estimates, with revenues of US$4.2m and a statutory loss per share (eps) of US$0.17 falling 7.5% and 3.0% below expectations, respectively. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
We've discovered 2 warning signs about OmniAb. View them for free.
After the latest results, the consensus from OmniAb's eight analysts is for revenues of US$22.6m in 2025, which would reflect a considerable 16% decline in revenue compared to the last year of performance. Per-share losses are supposed to see a sharp uptick, reaching US$0.59. Before this latest report, the consensus had been expecting revenues of US$23.0m and US$0.60 per share in losses.
View our latest analysis for OmniAb
The analysts trimmed their valuations, with the average price target falling 7.4% to US$7.88, with the ongoing losses seemingly weighing on sentiment, despite no real changes to the earnings 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. The most optimistic OmniAb analyst has a price target of US$11.00 per share, while the most pessimistic values it at US$4.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. One thing that stands out from these estimates is that revenues are expected to keep falling until the end of 2025, roughly in line with the historical decline of 24% per annum over the past three years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 6.0% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect OmniAb to suffer worse than the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that OmniAb's revenue is expected to perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 estimates - from multiple OmniAb analysts - going out to 2027, 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 OmniAb (1 is concerning!) 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.