The analysts covering Medexus Pharmaceuticals Inc. (TSE:MDP) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) estimates were cut sharply as the analysts factored in the latest outlook for the business, concluding that they were too optimistic previously.

Following the latest downgrade, Medexus Pharmaceuticals' five analysts currently expect revenues in 2025 to be US$114m, approximately in line with the last 12 months. Statutory earnings per share are supposed to plunge 61% to US$0.094 in the same period. Before this latest update, the analysts had been forecasting revenues of US$136m and earnings per share (EPS) of US$0.48 in 2025. Indeed, we can see that the analysts are a lot more bearish about Medexus Pharmaceuticals' prospects, administering a measurable cut to revenue estimates and slashing their EPS estimates to boot.

View our latest analysis for Medexus Pharmaceuticals

It'll come as no surprise then, to learn that the analysts have cut their price target 19% to CA$3.35.

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 1.1% by the end of 2025. This indicates a significant reduction from annual growth of 25% 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 11% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Medexus Pharmaceuticals is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Medexus Pharmaceuticals' revenues are expected to grow slower than the wider market. With a serious cut to next year's expectations and a falling price target, we wouldn't be surprised if investors were becoming wary of Medexus Pharmaceuticals.

That said, the analysts might have good reason to be negative on Medexus Pharmaceuticals, given dilutive stock issuance over the past year. For more information, you can click here to discover this and the 3 other risks we've identified.