MediaAlpha, Inc. Just Beat EPS By 40%: Here's What Analysts Think Will Happen Next

As you might know, MediaAlpha, Inc. (NYSE:MAX) just kicked off its latest third-quarter results with some very strong numbers. The company beat forecasts, with revenue of US$259m, some 4.7% above estimates, and statutory earnings per share (EPS) coming in at US$0.17, 40% ahead of expectations. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for MediaAlpha

Taking into account the latest results, the most recent consensus for MediaAlpha from seven analysts is for revenues of US$1.00b in 2025. If met, it would imply a sizeable 47% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 231% to US$0.58. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$964.7m and earnings per share (EPS) of US$0.50 in 2025. So it seems there's been a definite increase in optimism about MediaAlpha's future following the latest results, with a nice gain to the earnings per share forecasts in particular.

Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$24.86, suggesting that the forecast performance does not have a long term impact on the company's valuation. 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 MediaAlpha analyst has a price target of US$31.00 per share, while the most pessimistic values it at US$13.00. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. For example, we noticed that MediaAlpha's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 36% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 2.4% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 11% annually. So it looks like MediaAlpha is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around MediaAlpha's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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

Before you take the next step you should know about the 4 warning signs for MediaAlpha (2 are potentially serious!) that we have uncovered.

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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.