Evolv Technologies Holdings, Inc. (NASDAQ:EVLV) Just Reported Earnings, And Analysts Cut Their Target Price

Shareholders of Evolv Technologies Holdings, Inc. (NASDAQ:EVLV) will be pleased this week, given that the stock price is up 12% to US$3.12 following its latest full-year results. Evolv Technologies Holdings beat revenue forecasts by a solid 13%, hitting US$55m. Statutory losses also increased, with a per-share loss of US$0.60, slightly larger than what the analysts wereexpecting. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Evolv Technologies Holdings

After the latest results, the five analysts covering Evolv Technologies Holdings are now predicting revenues of US$59.5m in 2023. If met, this would reflect a reasonable 7.7% improvement in sales compared to the last 12 months. Per-share losses are predicted to creep up to US$0.61. Before this earnings announcement, the analysts had been modelling revenues of US$60.1m and losses of US$0.64 per share in 2023. 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 this year.

The consensus price target fell 7.6% to US$5.08despite the forecast for smaller losses next year. It looks like the ongoing lack of profitability is starting to weigh on valuations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Evolv Technologies Holdings, with the most bullish analyst valuing it at US$7.00 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.

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 Evolv Technologies Holdings' revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 72% 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) 5.1% per year. So it's pretty clear that, while Evolv Technologies Holdings' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Evolv Technologies Holdings going out to 2025, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 3 warning signs for Evolv Technologies Holdings 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.