Revenue Miss: VirTra, Inc. Fell 26% Short Of Analyst Revenue Estimates And Analysts Have Been Revising Their Models

Shareholders might have noticed that VirTra, Inc. (NASDAQ:VTSI) filed its quarterly result this time last week. The early response was not positive, with shares down 5.7% to US$7.13 in the past week. Revenues were US$6.1m, 26% shy of what the analysts were expecting, although statutory earnings of US$0.11 per share were roughly in line with what was forecast. 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 VirTra

After the latest results, the consensus from VirTra's dual analysts is for revenues of US$28.1m in 2024, which would reflect a not inconsiderable 12% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to dive 56% to US$0.27 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$38.1m and earnings per share (EPS) of US$0.69 in 2024. Indeed, we can see that the analysts are a lot more bearish about VirTra's prospects following the latest results, administering a large cut to revenue estimates and slashing their EPS estimates to boot.

It'll come as no surprise then, to learn that the analysts have cut their price target 36% to US$11.25.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 22% by the end of 2024. This indicates a significant reduction from annual growth of 18% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - VirTra is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for VirTra. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of VirTra's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for VirTra (1 is significant!) that you need to be mindful of.

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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.