Analysts Are Upgrading Inseego Corp. (NASDAQ:INSG) After Its Latest Results

A week ago, Inseego Corp. (NASDAQ:INSG) came out with a strong set of first-quarter numbers that could potentially lead to a re-rate of the stock. Revenues and losses per share were both better than expected, with revenues of US$45m leading estimates by 5.7%. Statutory losses were smaller than the analystsexpected, coming in at US$0.44 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Inseego after the latest results.

Check out our latest analysis for Inseego

After the latest results, the three analysts covering Inseego are now predicting revenues of US$196.9m in 2024. If met, this would reflect a satisfactory 3.7% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 53% to US$1.92. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$181.2m and losses of US$2.70 per share in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a very promising decrease in loss per share in particular.

It will come as no surprise to learn thatthe analysts have increased their price target for Inseego 14% to US$4.57on the back of these upgrades. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Inseego, with the most bullish analyst valuing it at US$6.00 and the most bearish at US$3.50 per share. 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.

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. For example, we noticed that Inseego's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 4.9% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 1.5% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 5.2% annually. So while Inseego's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also upgraded their revenue forecasts, although the latest estimates suggest that Inseego will grow in line with the overall 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Inseego going out to 2025, and you can see them free on our platform here.

It is also worth noting that we have found 5 warning signs for Inseego (2 are concerning!) that you need to take into consideration.

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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.