Yahoo Finance Earnings Update: Here's Why Analysts Just Lifted Their Coveo Solutions Inc. (TSE:CVO) Price Target To CA$13.63
Shareholders will be ecstatic, with their stake up 23% over the past week following Coveo Solutions Inc.'s (TSE:CVO) latest quarterly results. It was a respectable set of results; while revenues of US$32m were in line with analyst predictions, statutory losses were 11% smaller than expected, with Coveo Solutions losing US$0.06 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
See our latest analysis for Coveo Solutions
Following the latest results, Coveo Solutions' ten analysts are now forecasting revenues of US$146.5m in 2025. This would be a solid 19% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 21% to US$0.21. Before this earnings announcement, the analysts had been modelling revenues of US$147.7m and losses of US$0.23 per share in 2025. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.
The average price target rose 6.5% to CA$13.63, with the analysts signalling that the forecast reduction in losses would be a positive for the stock's valuation. 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. Currently, the most bullish analyst values Coveo Solutions at CA$14.91 per share, while the most bearish prices it at CA$10.99. 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.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Coveo Solutions' revenue growth is expected to slow, with the forecast 15% annualised growth rate until the end of 2025 being well below the historical 21% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 17% annually. Factoring in the forecast slowdown in growth, it looks like Coveo Solutions is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
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 estimates - from multiple Coveo Solutions analysts - going out to 2026, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 1 warning sign for Coveo Solutions that you need to be mindful of.
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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.
