Earnings Update: Here's Why Analysts Just Lifted Their Allbirds, Inc. (NASDAQ:BIRD) Price Target To US$11.00

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Allbirds, Inc. (NASDAQ:BIRD) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Revenues and losses per share were both better than expected, with revenues of US$40m leading estimates by 2.8%. Statutory losses were smaller than the analystsexpected, coming in at US$1.92 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Following last week's earnings report, Allbirds' four analysts are forecasting 2025 revenues to be US$168.2m, approximately in line with the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$9.39. Before this earnings announcement, the analysts had been modelling revenues of US$175.7m and losses of US$9.64 per share in 2025. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for this year.

View our latest analysis for Allbirds

The consensus price target rose 16% to US$11.00, with the analysts increasingly optimistic about shrinking losses, despite the expected decline in revenue. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Allbirds analyst has a price target of US$14.00 per share, while the most pessimistic values it at US$8.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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 also point out that the forecast 2.8% annualised revenue decline to the end of 2025 is better than the historical trend, which saw revenues shrink 20% annually over the past three years By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 5.7% per year. So while a broad number of companies are forecast to grow, unfortunately Allbirds is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, long term profitability is more important for the value creation process. 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 estimates - from multiple Allbirds analysts - going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for Allbirds (1 doesn't sit too well with us!) that you need to take into consideration.

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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.