Day One Biopharmaceuticals, Inc. (NASDAQ:DAWN) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year's statutory forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

Following the upgrade, the latest consensus from Day One Biopharmaceuticals' ten analysts is for revenues of US$162m in 2025, which would reflect a huge 58% improvement in sales compared to the last 12 months. Per-share losses are expected to explode, reaching US$1.08 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$134m and losses of US$1.83 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.

View our latest analysis for Day One Biopharmaceuticals

There was no major change to the consensus price target of US$36.67, perhaps suggesting that the analysts remain concerned about ongoing losses despite the improved earnings and revenue outlook.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Day One Biopharmaceuticals' revenue growth is expected to slow, with the forecast 45% annualised growth rate until the end of 2025 being well below the historical 119% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 21% per year. Even after the forecast slowdown in growth, it seems obvious that Day One Biopharmaceuticals is also expected to grow faster than the wider industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses next year, perhaps suggesting Day One Biopharmaceuticals is moving incrementally towards profitability. They also upgraded their revenue estimates for next year, and sales are expected to grow faster than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to next year's earnings expectations, it might be time to take another look at Day One Biopharmaceuticals.

Better yet, Day One Biopharmaceuticals is expected to break-even soon - within the next few years - according to analyst forecasts, which would be a momentous event for shareholders. For more information, you can click through to our free platform to learn more about these forecasts.

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