Shareholders in BARK, Inc. (NYSE:BARK) had a terrible week, as shares crashed 22% to US$2.00 in the week since its latest full-year results. Revenues were in line with expectations, at US$507m, while statutory losses ballooned to US$0.44 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following the latest results, BARK's twin analysts are now forecasting revenues of US$556.2m in 2023. This would be a meaningful 9.6% improvement in sales compared to the last 12 months. Losses are expected to be contained, narrowing 10% from last year to US$0.35. Before this latest report, the consensus had been expecting revenues of US$650.8m and US$0.19 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 33% to US$8.00, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the BARK's past performance and to peers in the same industry. We would highlight that BARK's revenue growth is expected to slow, with the forecast 9.6% annualised growth rate until the end of 2023 being well below the historical 35% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 14% 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 BARK.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at BARK. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for BARK going out as far as 2025, and you can see them free on our platform here.
It is also worth noting that we have found 3 warning signs for BARK (1 can't be ignored!) that you need to take into consideration.
Valuation is complex, but we're helping make it simple.
Find out whether BARK is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.