Yahoo Finance Allbirds, Inc. (NASDAQ:BIRD) Just Reported, And Analysts Assigned A US$11.00 Price Target
One of the biggest stories of last week was how Allbirds, Inc. (NASDAQ:BIRD) shares plunged 34% in the week since its latest quarterly results, closing yesterday at US$3.99. Revenues were in line with expectations, at US$63m, while statutory losses ballooned to US$0.15 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Allbirds
Taking into account the latest results, the consensus forecast from Allbirds' 13 analysts is for revenues of US$362.4m in 2022, which would reflect a major 25% improvement in sales compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 29% to US$0.26. Before this latest report, the consensus had been expecting revenues of US$362.4m and US$0.26 per share in losses.
As a result, it's unexpected to see that the consensus price target fell 27% to US$11.00, with the analysts seemingly becoming more concerned about ongoing losses, despite making no major changes to their forecasts. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Allbirds, with the most bullish analyst valuing it at US$20.00 and the most bearish at US$6.00 per share. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. 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.
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. It's clear from the latest estimates that Allbirds' rate of growth is expected to accelerate meaningfully, with the forecast 34% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 25% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.5% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Allbirds is expected to grow much faster than its industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster 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 Allbirds' future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Allbirds analysts - going out to 2024, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Allbirds that you need to take into consideration.
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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.
