Analysts Have Been Trimming Their Boqii Holding Limited (NYSE:BQ) Price Target After Its Latest Report

Investors in Boqii Holding Limited (NYSE:BQ) had a good week, as its shares rose 7.9% to close at US$4.09 following the release of its full-year results. It was a respectable set of results; while revenues of CN¥1.0b were in line with analyst predictions, statutory losses were 19% smaller than expected, with Boqii Holding losing CN¥0.97 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. 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 Boqii Holding

Taking into account the latest results, the consensus forecast from Boqii Holding's dual analysts is for revenues of CN¥1.35b in 2022, which would reflect a substantial 34% improvement in sales compared to the last 12 months. Per-share losses are expected to explode, reaching CN¥2.26 per share. Before this earnings announcement, the analysts had been modelling revenues of CN¥1.36b and losses of CN¥1.48 per share in 2022. While this year's revenue estimates held steady, there was also a considerable increase to loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

The consensus price target fell 21% to CN¥51.12per share, with the analysts clearly concerned by ballooning losses.

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. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 34% growth on an annualised basis. That is in line with its 31% annual growth over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 16% per year. So although Boqii Holding is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Boqii Holding. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Boqii Holding going out as far as 2023, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Boqii Holding that you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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