Earnings Update: Here's Why Analysts Just Lifted Their WW International, Inc. (NASDAQ:WW) Price Target To US$8.75

Shareholders of WW International, Inc. (NASDAQ:WW) will be pleased this week, given that the stock price is up 19% to US$2.09 following its latest quarterly results. The results don't look great, especially considering that statutory losses grew 701% toUS$4.39 per share. Revenues of US$207m did beat expectations by 3.6%, but it looks like a bit of a cold comfort. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on WW International after the latest results.

See our latest analysis for WW International

Following last week's earnings report, WW International's six analysts are forecasting 2024 revenues to be US$845.3m, approximately in line with the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 97% to US$0.12. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$847.0m and losses of US$0.14 per share in 2024. Although the revenue estimates have not really changed WW International'sfuture looks a little different to the past, with a cut to the loss per share forecasts in particular.

The average price target rose 33% to US$8.75, with the analysts signalling that the forecast reduction in losses would be a positive for the stock'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. There are some variant perceptions on WW International, with the most bullish analyst valuing it at US$12.50 and the most bearish at US$4.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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 also point out that the forecast 1.4% annualised revenue decline to the end of 2024 is better than the historical trend, which saw revenues shrink 11% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 11% annually. So while a broad number of companies are forecast to grow, unfortunately WW International is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that WW International's revenue is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

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. We have estimates - from multiple WW International analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - WW International has 2 warning signs we think you should be aware 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.