Yahoo Finance Analysts Have Lowered Expectations For SmartRent, Inc. (NYSE:SMRT) After Its Latest Results
As you might know, SmartRent, Inc. (NYSE:SMRT) last week released its latest quarterly, and things did not turn out so great for shareholders. Unfortunately, SmartRent delivered a serious earnings miss. Revenues of US$42m were 17% below expectations, and statutory losses ballooned 21% to US$0.13 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on SmartRent after the latest results.
Check out our latest analysis for SmartRent
Taking into account the latest results, the most recent consensus for SmartRent from eight analysts is for revenues of US$187.6m in 2022 which, if met, would be a sizeable 25% increase on its sales over the past 12 months. Losses are forecast to narrow 6.1% to US$0.48 per share. Before this earnings announcement, the analysts had been modelling revenues of US$240.6m and losses of US$0.38 per share in 2022. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.
The consensus price target fell 8.9% to US$6.22, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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 SmartRent analyst has a price target of US$8.00 per share, while the most pessimistic values it at US$4.50. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
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 SmartRent's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 57% growth on an annualised basis. This is compared to a historical growth rate of 111% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.0% annually. So it's pretty clear that, while SmartRent's 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 increased their loss per share estimates for next year. They also downgraded their revenue estimates, although industry data suggests that SmartRent's revenues are expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of SmartRent's future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for SmartRent going out to 2024, and you can see them free on our platform here..
However, before you get too enthused, we've discovered 3 warning signs for SmartRent that you should be aware of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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