Earnings Update: Here's Why Analysts Just Lifted Their Weave Communications, Inc. (NYSE:WEAV) Price Target To US$16.93

Shareholders might have noticed that Weave Communications, Inc. (NYSE:WEAV) filed its third-quarter result this time last week. The early response was not positive, with shares down 2.6% to US$13.12 in the past week. Revenues of US$52m arrived in line with expectations, although statutory losses per share were US$0.08, an impressive 31% smaller than what broker models predicted. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Weave Communications

After the latest results, the seven analysts covering Weave Communications are now predicting revenues of US$235.7m in 2025. If met, this would reflect a huge 20% improvement in revenue compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.36. Before this latest report, the consensus had been expecting revenues of US$233.5m and US$0.37 per share in losses. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for next year.

These new estimates led to the consensus price target rising 11% to US$16.93, with lower forecast losses suggesting things could be looking up for Weave Communications. 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. The most optimistic Weave Communications analyst has a price target of US$20.00 per share, while the most pessimistic values it at US$14.50. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Weave Communications' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 23% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 12% per year. Even after the forecast slowdown in growth, it seems obvious that Weave Communications is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 estimates - from multiple Weave Communications analysts - going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 3 warning signs for Weave Communications that you should be aware 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.