Analysts Have Been Trimming Their CareCloud, Inc. (NASDAQ:CCLD) Price Target After Its Latest Report

There's been a notable change in appetite for CareCloud, Inc. (NASDAQ:CCLD) shares in the week since its annual report, with the stock down 11% to US$1.47. Revenues came in at US$111m, in line with forecasts and the company reported a statutory loss of US$0.28 per share, roughly in line with expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for CareCloud

Taking into account the latest results, CareCloud's five analysts currently expect revenues in 2025 to be US$112.4m, approximately in line with the last 12 months. CareCloud is also expected to turn profitable, with statutory earnings of US$0.11 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$111.6m and losses of US$0.21 per share in 2025. While there's been no material change to the revenue estimates, there's been a pretty clear upgrade to earnings estimates, with the analysts expecting a per-share profit compared to previous expectations of a loss. So it seems like the latest results have led to a significant increase in sentiment for CareCloud.

The consensus price target fell 15% to US$4.44, suggesting the increase in earnings forecasts was not enough to offset other the analysts concerns. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on CareCloud, with the most bullish analyst valuing it at US$6.00 and the most bearish at US$1.50 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that CareCloud's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.4% growth on an annualised basis. This is compared to a historical growth rate of 6.2% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that CareCloud is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts now expect CareCloud to become profitable next year, compared to previous expectations that it would report a loss. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple CareCloud analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for CareCloud you should know about.

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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.