There's been a notable change in appetite for Udemy, Inc. (NASDAQ:UDMY) shares in the week since its yearly report, with the stock down 12% to US$13.18. It was a pretty bad result overall; while revenues were in line with expectations at US$518m, statutory losses exploded to US$1.41 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Udemy
Following the latest results, Udemy's eleven analysts are now forecasting revenues of US$625.3m in 2022. This would be a huge 21% improvement in sales compared to the last 12 months. Losses are forecast to balloon 74% to US$0.97 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$629.8m and losses of US$0.80 per share in 2022. While this year's revenue estimates held steady, there was also a considerable increase to loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
The consensus price target fell 12% to US$27.80per share, with the analysts clearly concerned by ballooning losses. 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. Currently, the most bullish analyst values Udemy at US$42.00 per share, while the most bearish prices it at US$16.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
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. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 21% growth on an annualised basis. That is in line with its 21% annual growth over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 7.4% per year. So although Udemy is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Udemy. Happily, there were no major changes to revenue forecasts, with the business still 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 Udemy's future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Udemy going out to 2024, and you can see them free on our platform here..
Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Udemy (1 is a bit unpleasant) you should be aware of.
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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.
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