Mersana Therapeutics, Inc. (NASDAQ:MRSN) investors will be delighted, with the company turning in some strong numbers with its latest results. Revenues of US$40m beat estimates by a substantial 30% margin. Unfortunately, Mersana Therapeutics also reported a statutory loss of US$0.56 per share, which at least was smaller than the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Mersana Therapeutics

Taking into account the latest results, the current consensus, from the ten analysts covering Mersana Therapeutics, is for revenues of US$27.2m in 2025. This implies a substantial 33% reduction in Mersana Therapeutics' revenue over the past 12 months. Per-share losses are expected to explode, reaching US$0.71 per share. Before this earnings announcement, the analysts had been modelling revenues of US$22.8m and losses of US$0.71 per share in 2025. So there's been quite a change-up of views after the recent consensus updates, withthe analysts noticeably increasing their revenue forecasts while also expecting losses per share to hold steady.

The analysts trimmed their valuations, with the average price target falling 13% to US$4.71, with the ongoing losses clearly weighing on sentiment despite the upgraded revenue estimates. 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. The most optimistic Mersana Therapeutics analyst has a price target of US$9.00 per share, while the most pessimistic values it at US$1.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 33% by the end of 2025. This indicates a significant reduction from annual growth of 42% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 20% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Mersana Therapeutics is expected to lag 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. They also upgraded their revenue estimates for next year, even though it is expected to grow slower 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Mersana Therapeutics. Long-term earnings power is much more important than next year's profits. We have forecasts for Mersana Therapeutics going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 4 warning signs for Mersana Therapeutics you should be aware of, and 2 of them don't sit too well with us.

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