Earnings Beat: Sunworks, Inc. (NASDAQ:SUNW) Just Beat Analyst Forecasts, And Analysts Have Been Lifting Their Forecasts

Shareholders will be ecstatic, with their stake up 68% over the past week following Sunworks, Inc.'s (NASDAQ:SUNW) latest second-quarter results. Revenues were a bright spot, with US$36m in sales arriving 8.8% ahead of expectations, although statutory earnings didn't fare nearly so well, recording a loss of US$0.23, some 7.0% below consensus predictions. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Sunworks

Taking into account the latest results, the current consensus from Sunworks' twin analysts is for revenues of US$149.2m in 2022, which would reflect a decent 14% increase on its sales over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 37% to US$0.68. Before this earnings announcement, the analysts had been modelling revenues of US$140.4m and losses of US$0.75 per share in 2022. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for both revenues and losses per share.

The consensus price target rose 23% to US$4.00, with the analysts encouraged by the higher revenue and lower forecast losses for next year.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Sunworks' past performance and to peers in the same industry. The analysts are definitely expecting Sunworks' growth to accelerate, with the forecast 31% annualised growth to the end of 2022 ranking favourably alongside historical growth of 4.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sunworks 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for Sunworks going out as far as 2023, and you can see them free on our platform here.

Before you take the next step you should know about the 4 warning signs for Sunworks (1 is significant!) 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.