Yahoo Finance kneat.com, inc. (CVE:KSI) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?
Investors in kneat.com, inc. (CVE:KSI) had a good week, as its shares rose 4.0% to close at CA$2.09 following the release of its first-quarter results. Statutory results overall were mixed, with revenues coming in 34% lower than the analysts predicted. What's really surprising is that losses of CA$0.01 per share were 50% smaller than what was predicted. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for kneat.com
Taking into account the latest results, the consensus forecast from kneat.com's dual analysts is for revenues of CA$7.04m in 2020, which would reflect a sizeable 57% improvement in sales compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 23% to CA$0.06. Before this earnings announcement, the analysts had been modelling revenues of CA$7.56m and losses of CA$0.08 per share in 2020. Although the revenue estimates have fallen somewhat, kneat.com'sfuture looks a little different to the past, with a the loss per share forecasts in particular.
There was no major change to the CA$2.50 average price target, suggesting that the adjustments to revenue and earnings are not expected to have a long-term impact 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. Next year brings more of the same, according to the analysts, with revenue forecast to grow 57%, in line with its 65% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 17% per year. So it's pretty clear that kneat.com is forecast to grow substantially faster than its industry.
The Bottom Line
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. Still, earnings are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on kneat.com. Long-term earnings power is much more important than next year's profits. We have analyst estimates for kneat.com going out as far as 2021, and you can see them free on our platform here.
Even so, be aware that kneat.com is showing 5 warning signs in our investment analysis , and 1 of those shouldn't be ignored...
Love or hate this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
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. Thank you for reading.
