Yahoo Finance Clarivate Plc (NYSE:CLVT) Just Reported, And Analysts Assigned A US$8.05 Price Target
It's been a sad week for Clarivate Plc (NYSE:CLVT), who've watched their investment drop 20% to US$7.18 in the week since the company reported its yearly result. Revenues were in line with expectations, at US$2.6b, while statutory losses ballooned to US$1.47 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Clarivate
Following last week's earnings report, Clarivate's ten analysts are forecasting 2024 revenues to be US$2.62b, approximately in line with the last 12 months. Losses are predicted to fall substantially, shrinking 93% to US$0.10. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$2.69b and losses of US$0.054 per share in 2024. While this year's revenue estimates dropped there was also a very substantial increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
The average price target fell 10.0% to US$8.05, implicitly signalling that lower earnings per share are a leading indicator for Clarivate's valuation. 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. Currently, the most bullish analyst values Clarivate at US$10.00 per share, while the most bearish prices it at US$6.00. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Clarivate's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.4% by the end of 2024. This indicates a significant reduction from annual growth of 26% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.4% per year. It's pretty clear that Clarivate's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Clarivate. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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 Clarivate'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. We have forecasts for Clarivate going out to 2026, and you can see them free on our platform here.
It might also be worth considering whether Clarivate's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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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.
