Alkermes plc (NASDAQ:ALKS) just released its annual report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 3.4% to hit US$1.6b. Alkermes reported statutory earnings per share (EPS) US$2.17, which was a notable 12% above what the analysts had forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Alkermes

After the latest results, the consensus from Alkermes' 15 analysts is for revenues of US$1.40b in 2025, which would reflect a considerable 10% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to crater 49% to US$1.16 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.41b and earnings per share (EPS) of US$1.08 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target rose 5.7% to US$36.36, suggesting that higher earnings estimates flow through to the stock's valuation as well. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Alkermes, with the most bullish analyst valuing it at US$46.00 and the most bearish at US$21.00 per share. 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.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 10% annualised decline to the end of 2025. That is a notable change from historical growth of 8.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 21% per year. It's pretty clear that Alkermes' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Alkermes following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Alkermes going out to 2027, and you can see them free on our platform here..

It is also worth noting that we have found 1 warning sign for Alkermes that you need to take into consideration.

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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.