Eventbrite, Inc. Beat Analyst Profit Forecasts, And Analysts Have New Estimates

One of the biggest stories of last week was how Eventbrite, Inc. (NYSE:EB) shares plunged 27% in the week since its latest second-quarter results, closing yesterday at US$3.14. It looks like a credible result overall - although revenues of US$85m were what the analysts expected, Eventbrite surprised by delivering a statutory profit of US$0.01 per share, instead of the previously forecast loss. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Eventbrite

Taking into account the latest results, the seven analysts covering Eventbrite provided consensus estimates of US$322.0m revenue in 2024, which would reflect a perceptible 5.3% decline over the past 12 months. Per-share losses are expected to explode, reaching US$0.23 per share. Before this latest report, the consensus had been expecting revenues of US$365.4m and US$0.14 per share in losses. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.

The consensus price target fell 39% to US$5.30, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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. Currently, the most bullish analyst values Eventbrite at US$7.00 per share, while the most bearish prices it at US$4.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Eventbrite shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 10% by the end of 2024. This indicates a significant reduction from annual growth of 6.3% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.8% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Eventbrite is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased 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. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Eventbrite's future valuation.

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 Eventbrite analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Eventbrite that you need to be mindful 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.