Yahoo Finance Results: QuinStreet, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts
QuinStreet, Inc. (NASDAQ:QNST) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were US$139m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.27, an impressive 145% ahead of estimates. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for QuinStreet
Following the latest results, QuinStreet's five analysts are now forecasting revenues of US$521.8m in 2021. This would be a modest 3.7% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to plunge 57% to US$0.26 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$502.1m and earnings per share (EPS) of US$0.21 in 2021. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a very substantial lift in earnings per share in particular.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 21% to US$21.50per share. 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 QuinStreet, with the most bullish analyst valuing it at US$23.00 and the most bearish at US$17.00 per share. This is a very narrow spread of estimates, implying either that QuinStreet is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that QuinStreet's revenue growth will slow down substantially, with revenues next year expected to grow 3.7%, compared to a historical growth rate of 14% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 16% next year. Factoring in the forecast slowdown in growth, it seems obvious that QuinStreet is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards QuinStreet following these results. They also upgraded their revenue estimates for next year, even though sales are expected to grow slower than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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 QuinStreet going out to 2023, 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 4 warning signs for QuinStreet that you need to be mindful of.
This article by Simply Wall St is general in nature. 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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