One of the biggest stories of last week was how Bird Global, Inc. (NYSE:BRDS) shares plunged 35% in the week since its latest yearly results, closing yesterday at US$2.56. It looks like the results were pretty good overall. While revenues of US$205m were in line with analyst predictions, statutory losses were much smaller than expected, with Bird Global losing US$2.51 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Bird Global from three analysts is for revenues of US$353.7m in 2022 which, if met, would be a sizeable 72% increase on its sales over the past 12 months. Per-share losses are predicted to creep up to US$0.83. Before this latest report, the consensus had been expecting revenues of US$375.6m and US$1.28 per share in losses. Although the revenue estimates have fallen somewhat, Bird Global'sfuture looks a little different to the past, with a very promising decrease in the loss per share forecasts in particular.
The consensus price target fell 18% to US$8.00, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Bird Global analyst has a price target of US$10.00 per share, while the most pessimistic values it at US$6.00. 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. We would highlight that Bird Global's revenue growth is expected to slow, with the forecast 72% annualised growth rate until the end of 2022 being well below the historical 117% growth over the last year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.6% annually. Even after the forecast slowdown in growth, it seems obvious that Bird Global is also expected to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Even so, earnings are more important to the intrinsic value of the business. 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.
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 forecasts for Bird Global going out to 2023, and you can see them free on our platform here.
Even so, be aware that Bird Global is showing 3 warning signs in our investment analysis , and 1 of those is potentially serious...
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.