Yahoo Finance Earnings Update: Velodyne Lidar, Inc. (NASDAQ:VLDR) Just Reported And Analysts Are Trimming Their Forecasts
It's shaping up to be a tough period for Velodyne Lidar, Inc. (NASDAQ:VLDR), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. It was not a great statutory result, with revenues coming in 22% lower than the analysts predicted. Unsurprisingly, earnings also fell seriously short of forecasts, turning into a per-share loss of US$0.42. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
View our latest analysis for Velodyne Lidar
Taking into account the latest results, the current consensus, from the eight analysts covering Velodyne Lidar, is for revenues of US$79.5m in 2021, which would reflect a discernible 2.2% reduction in Velodyne Lidar's sales over the past 12 months. Losses are predicted to fall substantially, shrinking 27% to US$1.00. Before this earnings announcement, the analysts had been modelling revenues of US$85.1m and losses of US$1.00 per share in 2021.
The average price target fell 11% to US$13.75, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing losses. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Velodyne Lidar at US$30.00 per share, while the most bearish prices it at US$9.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. 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.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that sales are expected to reverse, with a forecast 4.3% annualised revenue decline to the end of 2021. That is a notable change from historical growth of 4.3% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 7.4% per year. It's pretty clear that Velodyne Lidar's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse 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 Velodyne Lidar. Long-term earnings power is much more important than next year's profits. We have forecasts for Velodyne Lidar going out to 2023, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 3 warning signs for Velodyne Lidar you should be aware of.
This article by Simply Wall St is general in nature. 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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