Tarsus Pharmaceuticals, Inc. (NASDAQ:TARS) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's statutory forecasts. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals. Investors have been pretty optimistic on Tarsus Pharmaceuticals too, with the stock up 26% to US$37.87 over the past week. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the current consensus from Tarsus Pharmaceuticals' seven analysts is for revenues of US$82m in 2024 which - if met - would reflect a sizeable 370% increase on its sales over the past 12 months. Losses are expected to increase substantially, hitting US$4.45 per share. Yet before this consensus update, the analysts had been forecasting revenues of US$62m and losses of US$5.04 per share in 2024. 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.

Check out our latest analysis for Tarsus Pharmaceuticals

It will come as no surprise to learn that the analysts have increased their price target for Tarsus Pharmaceuticals 13% to US$50.56 on the back of these upgrades.

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 clear from the latest estimates that Tarsus Pharmaceuticals' rate of growth is expected to accelerate meaningfully, with the forecast 4x annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 23% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.1% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Tarsus Pharmaceuticals is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that analysts reduced their loss per share estimates for this year, reflecting increased optimism around Tarsus Pharmaceuticals' prospects. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Tarsus Pharmaceuticals could be worth investigating further.