Coveo Solutions Inc. (TSE:CVO) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

The investors in Coveo Solutions Inc.'s (TSE:CVO) will be rubbing their hands together with glee today, after the share price leapt 38% to CA$7.25 in the week following its quarterly results. It was a respectable set of results; while revenues of US$33m were in line with analyst predictions, statutory losses were 18% smaller than expected, with Coveo Solutions losing US$0.05 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Coveo Solutions

Taking into account the latest results, the current consensus from Coveo Solutions' nine analysts is for revenues of US$134.3m in 2025. This would reflect an okay 3.8% increase on its revenue over the past 12 months. Losses are forecast to narrow 9.3% to US$0.20 per share. Before this latest report, the consensus had been expecting revenues of US$134.6m and US$0.20 per share in losses.

The consensus price target was unchanged at CA$10.09, suggesting that the business - losses and all - is executing in line with estimates. 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. There are some variant perceptions on Coveo Solutions, with the most bullish analyst valuing it at CA$13.48 and the most bearish at CA$7.06 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Coveo Solutions' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.8% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 16% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Coveo Solutions.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. 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 Coveo Solutions. Long-term earnings power is much more important than next year's profits. We have forecasts for Coveo Solutions going out to 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Coveo Solutions that we have uncovered.

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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.