Analyst Estimates: Here's What Brokers Think Of Alight, Inc. (NYSE:ALIT) After Its First-Quarter Report

Alight, Inc. (NYSE:ALIT) shareholders are probably feeling a little disappointed, since its shares fell 6.3% to US$8.29 in the week after its latest first-quarter results. The results don't look great, especially considering that statutory losses grew 132% toUS$0.14 per share. Revenues of US$831m did beat expectations by 3.4%, but it looks like a bit of a cold comfort. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Alight after the latest results.

View our latest analysis for Alight

After the latest results, the six analysts covering Alight are now predicting revenues of US$3.50b in 2023. If met, this would reflect a meaningful 8.0% improvement in sales compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.22. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$3.48b and losses of US$0.11 per share in 2023. So it's pretty clear the analysts have mixed opinions on Alight even after this update; although they reconfirmed their revenue numbers, it came at the cost of a regrettable increase in per-share losses.

The consensus price target held steady at US$13.93, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Alight at US$15.00 per share, while the most bearish prices it at US$12.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. We would highlight that Alight's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2023 being well below the historical 42% growth over the last year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.4% annually. So it's pretty clear that, while Alight's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Alight. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Alight going out to 2025, and you can see them free on our platform here..

It might also be worth considering whether Alight's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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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.