It's been a sad week for Pacific Biosciences of California, Inc. (NASDAQ:PACB), who've watched their investment drop 15% to US$1.19 in the week since the company reported its quarterly result. It was a moderately negative result overall - revenue fell 3.9% short of analyst estimates at US$39m, and statutory losses were in line with analyst expectations, at US$0.14 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, Pacific Biosciences of California's six analysts currently expect revenues in 2026 to be US$159.5m, approximately in line with the last 12 months. Per-share losses are predicted to creep up to US$0.44. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$167.4m and losses of US$0.42 per share in 2026. Overall it looks as though the analysts are negative in this update. Although revenue forecasts held steady, the consensus also made a moderate increase in to its losses per share forecasts.

The average price target fell 6.8% to US$2.29, implicitly signalling that lower earnings per share are a leading indicator for Pacific Biosciences of California's valuation. 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 Pacific Biosciences of California analyst has a price target of US$3.00 per share, while the most pessimistic values it at US$1.25. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for 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. It's pretty clear that there is an expectation that Pacific Biosciences of California's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 0.2% growth on an annualised basis. This is compared to a historical growth rate of 6.0% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.9% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Pacific Biosciences of California.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Pacific Biosciences of California. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Pacific Biosciences of California's future valuation.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Pacific Biosciences of California going out to 2028, and you can see them free on our platform here..

Even so, be aware that Pacific Biosciences of California is showing 3 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

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.