OmniAb, Inc. (NASDAQ:OABI) Just Reported Third-Quarter Earnings And Analysts Are Lifting Their Estimates
OmniAb, Inc. (NASDAQ:OABI) just released its quarterly report and things are looking bullish. Revenues were better than expected, with US$4.0m in revenue some 14% ahead of forecasts. The company still lost US$0.12 per share, although the losses were marginally smaller than the analysts expected. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following the latest results, OmniAb's seven analysts are now forecasting revenues of US$47.0m in 2027. This would be a meaningful 17% improvement in revenue compared to the last 12 months. Losses are expected to be contained, narrowing 14% from last year to US$0.26. Before this earnings announcement, the analysts had been modelling revenues of US$43.9m and losses of US$0.28 per share in 2027. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for both revenues and losses per share.
Check out our latest analysis for OmniAb
Despite these upgrades,the analysts have not made any major changes to their price target of US$8.33, implying that their latest estimates don't have a long term impact on what they think the stock is worth. 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. The most optimistic OmniAb analyst has a price target of US$12.00 per share, while the most pessimistic values it at US$5.00. 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.
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. For example, we noticed that OmniAb's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 13% growth to the end of 2027 on an annualised basis. That is well above its historical decline of 11% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 7.0% per year. Not only are OmniAb's revenues expected to improve, it seems that the analysts are also expecting it to grow faster 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at US$8.33, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on OmniAb. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple OmniAb analysts - going out to 2028, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 1 warning sign for OmniAb that you should be aware of.
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