Need To Know: Analysts Just Made A Substantial Cut To Their WM Technology, Inc. (NASDAQ:MAPS) Estimates

The analysts covering WM Technology, Inc. (NASDAQ:MAPS) delivered a dose of negativity to shareholders today, by making a substantial revision to their statutory forecasts for next year. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting the analysts have soured majorly on the business.

Following this downgrade, WM Technology's six analysts are forecasting 2023 revenues to be US$223m, approximately in line with the last 12 months. After this downgrade, the company is anticipated to report a loss of US$0.12 in 2023, a sharp decline from a profit over the last year. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$248m and losses of US$0.044 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also expecting losses per share to increase.

See our latest analysis for WM Technology

The consensus price target fell 29% to US$3.59, implicitly signalling that lower earnings per share are a leading indicator for WM Technology's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on WM Technology, with the most bullish analyst valuing it at US$5.00 and the most bearish at US$2.00 per share. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the WM Technology's past performance and to peers in the same industry. We would highlight that WM Technology's revenue growth is expected to slow, with the forecast 1.0% annualised growth rate until the end of 2023 being well below the historical 17% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 13% annually. Factoring in the forecast slowdown in growth, it seems obvious that WM Technology is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to note from this downgrade is that the consensus increased its forecast losses next year, suggesting all may not be well at WM Technology. Regrettably, they also downgraded their revenue estimates, and the latest forecasts imply the business will grow sales slower than the wider market. After such a stark change in sentiment from analysts, we'd understand if readers now felt a bit wary of WM Technology.

That said, the analysts might have good reason to be negative on WM Technology, given recent substantial insider selling. For more information, you can click here to discover this and the 3 other concerns we've identified.

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.