Sun. Dec 10th, 2023
    CRISPR Therapeutics AG: Analysts’ Price Targets and Earnings Estimates

    CRISPR Therapeutics AG (CRSP) has seen a significant increase in its stock price over the past four weeks, with a gain of 75.8%. This performance has caught the attention of Wall Street analysts who have set short-term price targets that suggest there could be more upside potential for the stock. The mean price target of $90.80 indicates a 33.8% potential increase.

    It is important to consider the standard deviation of the price targets, which is $46.01 in this case. A smaller standard deviation indicates greater agreement among analysts. While the lowest estimate of $42 suggests a decline of 38.1% from the current price level, the most optimistic analyst expects the stock to surge 224.1% to reach $220.

    While the consensus price target can be a useful metric, it should not be relied upon solely when making investment decisions. The ability and unbiasedness of analysts in setting price targets have long been questioned, according to researchers at universities around the world.

    Analysts often set overly optimistic price targets to generate interest in stocks that their firms have business relationships with or are looking to associate with. However, a low standard deviation among price targets indicates a high degree of agreement among analysts about the direction and magnitude of a stock’s price movement. It serves as a starting point for further research to identify potential driving forces.

    In the case of CRSP, analysts’ optimism about the company’s earnings prospects is another reason to expect an upside in the stock. The revision of EPS estimates higher by a significant number of analysts indicates a strong correlation between earnings estimate revisions and near-term stock price movements.

    CRSP also has a Zacks Rank #2 (Buy), indicating its favorable position based on four factors related to earnings estimates. This further supports the potential upside in the near term.

    While price targets and earnings estimates can provide useful insights, investors should exercise skepticism and conduct comprehensive research before making investment decisions.