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Instructure Holdings, Inc. (NYSE:INST) Second-Quarter Results: Here's What Analysts Are Forecasting For This Year

·3 min read

As you might know, Instructure Holdings, Inc. (NYSE:INST) recently reported its quarterly numbers. The results were mixed overall, with revenues slightly ahead of analyst estimates at US$115m. Statutory losses by contrast were 2.4% larger than predictions at US$0.09 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Instructure Holdings

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Taking into account the latest results, the most recent consensus for Instructure Holdings from nine analysts is for revenues of US$467.3m in 2022 which, if met, would be a modest 4.8% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 35% to US$0.24. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$464.2m and losses of US$0.24 per share in 2022.

The consensus price target was unchanged at US$30.25, suggesting that the business - losses and all - is executing in line with estimates. 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. There are some variant perceptions on Instructure Holdings, with the most bullish analyst valuing it at US$35.00 and the most bearish at US$22.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Instructure Holdings' past performance and to peers in the same industry. We would highlight that Instructure Holdings' revenue growth is expected to slow, with the forecast 9.8% annualised growth rate until the end of 2022 being well below the historical 22% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 13% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Instructure Holdings.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Instructure Holdings' revenues are expected to perform worse than the wider industry. The consensus price target held steady at US$30.25, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Instructure Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for Instructure Holdings going out to 2024, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Instructure Holdings , and understanding them should be part of your investment process.

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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