What Does The Future Hold For Innovid Corp. (NYSE:CTV)? These Analysts Have Been Cutting Their Estimates

One thing we could say about the analysts on Innovid Corp. (NYSE:CTV) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. This report focused on revenue estimates, and it looks as though the consensus view of the business has become substantially more conservative.

Following the latest downgrade, Innovid's four analysts currently expect revenues in 2023 to be US$128m, approximately in line with the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 42% to US$0.08. However, before this estimates update, the consensus had been expecting revenues of US$152m and US$0.097 per share in losses. We can see there's definitely been a change in sentiment in this update, with the analysts administering a meaningful downgrade to this year's revenue estimates, while at the same time reducing their loss estimates.

Check out our latest analysis for Innovid

the analysts have cut their price target 24% to US$3.10 per share, suggesting that the declining revenue was a more crucial indicator than the forecast reduction in losses. 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 Innovid, with the most bullish analyst valuing it at US$5.00 and the most bearish at US$2.00 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Innovid's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Innovid's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 0.3% growth on an annualised basis. This is compared to a historical growth rate of 27% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.0% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Innovid.

The Bottom Line

Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Innovid's revenues are expected to grow slower than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Innovid's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Innovid after today.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Innovid going out to 2024, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.