COBZ

CoBiz Financial Inc.

0.1100
USD
0.00%
0.1100
USD
0.00%
0.0000 0.0000
52 weeks
52 weeks

Mkt Cap 4.66M

Shares Out 42.40M

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ACV Auctions Inc. (NASDAQ:ACVA) Just Reported Earnings, And Analysts Cut Their Target Price

As you might know, ACV Auctions Inc. (NASDAQ:ACVA) just kicked off its latest quarterly results with some very strong numbers. Revenues and losses per share both beat expectations, with revenues of US$115m leading estimates by 3.6%. Statutory losses were somewhat smaller thanthe analysts expected, coming in at US$0.16 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year. Taking into account the latest results, the consensus forecast from ACV Auctions' 16 analysts is for revenues of US$431.3m in 2022, which would reflect a credible 5.2% improvement in sales compared to the last 12 months. Losses are expected to increase slightly, to US$0.70 per share. Before this earnings announcement, the analysts had been modelling revenues of US$453.7m and losses of US$0.70 per share in 2022. The average price target fell 7.6% to US$16.04, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing 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. The most optimistic ACV Auctions analyst has a price target of US$23.00 per share, while the most pessimistic values it at US$9.00. 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. These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the ACV Auctions' past performance and to peers in the same industry. It's pretty clear that there is an expectation that ACV Auctions' revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 43% over the past year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.2% per year. Even after the forecast slowdown in growth, it seems obvious that ACV Auctions is also expected to grow faster than the wider industry. The most important thing to take away is that the analysts reconfirmed 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 in mind, we wouldn't be too quick to come to a conclusion on ACV Auctions. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for ACV Auctions going out to 2024, and you can see them free on our platform here.. We also provide an overview of the ACV Auctions Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. 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. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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