Berkshire Grey, Inc. (NASDAQ:BGRY) Just Reported And Analysts Have Been Cutting Their Estimates

It's been a good week for Berkshire Grey, Inc. (NASDAQ:BGRY) shareholders, because the company has just released its latest quarterly results, and the shares gained 3.9% to US$1.07. It looks like the results were pretty good overall. While revenues of US$24m were in line with analyst predictions, statutory losses were much smaller than expected, with Berkshire Grey losing US$0.11 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Berkshire Grey

After the latest results, the two analysts covering Berkshire Grey are now predicting revenues of US$128.3m in 2023. If met, this would reflect a substantial 69% improvement in sales compared to the last 12 months. Losses are expected to hold steady at around US$0.49. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$154.0m and losses of US$0.49 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, withthe analysts making a serious cut to their revenue forecasts while also making no real change to the loss per share numbers.

The average price target fell 32% to US$3.25, with the analysts clearly concerned about the weaker revenue outlook and expectation of ongoing losses.

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. We would highlight that Berkshire Grey's revenue growth is expected to slow, with the forecast 52% annualised growth rate until the end of 2023 being well below the historical 66% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.2% per year. Even after the forecast slowdown in growth, it seems obvious that Berkshire Grey is also expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also downgraded their revenue estimates, although industry data suggests that Berkshire Grey's revenues are expected to 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.

Plus, you should also learn about the 5 warning signs we've spotted with Berkshire Grey (including 2 which are a bit unpleasant) .

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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.