Weave Communications, Inc. (NYSE:WEAV) Released Earnings Last Week And Analysts Lifted Their Price Target To US$14.86

As you might know, Weave Communications, Inc. (NYSE:WEAV) just kicked off its latest quarterly results with some very strong numbers. Weave Communications beat expectations with revenues of US$47m arriving 3.0% ahead of forecasts. The company also reported a statutory loss of US$0.10, 9.1% smaller than was expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Weave Communications

After the latest results, the seven analysts covering Weave Communications are now predicting revenues of US$199.1m in 2024. If met, this would reflect a solid 12% improvement in revenue compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.41. Before this earnings announcement, the analysts had been modelling revenues of US$196.3m and losses of US$0.40 per share in 2024.

The consensus price target rose 13% to US$14.86, with the analysts increasing their valuations as the business executes in line with forecasts. 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$18.00 per share, while the most pessimistic values it at US$12.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's pretty clear that there is an expectation that Weave Communications' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 21% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 13% per year. So it's pretty clear that, while Weave Communications' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Weave Communications. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Weave Communications analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Weave Communications you should know about.

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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.