Yahoo Finance Analysts Have Lowered Expectations For Offerpad Solutions Inc. (NYSE:OPAD) After Its Latest Results
Shareholders might have noticed that Offerpad Solutions Inc. (NYSE:OPAD) filed its quarterly result this time last week. The early response was not positive, with shares down 9.5% to US$6.86 in the past week. The results don't look great, especially considering that statutory losses grew 39% toUS$0.64 per share. Revenues of US$285m did beat expectations by 5.6%, but it looks like a bit of a cold comfort. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for Offerpad Solutions
Taking into account the latest results, the current consensus from Offerpad Solutions' five analysts is for revenues of US$1.17b in 2024. This would reflect a decent 18% increase on its revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 38% to US$1.71. Before this latest report, the consensus had been expecting revenues of US$1.33b and US$1.34 per share in losses. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.
The consensus price target fell 15% to US$7.30, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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. There are some variant perceptions on Offerpad Solutions, with the most bullish analyst valuing it at US$9.00 and the most bearish at US$6.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Offerpad Solutions' rate of growth is expected to accelerate meaningfully, with the forecast 25% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.3% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 11% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Offerpad Solutions is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Offerpad Solutions going out to 2026, and you can see them free on our platform here.
Even so, be aware that Offerpad Solutions is showing 3 warning signs in our investment analysis , you should know about...
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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.
