Yahoo Finance The Udemy, Inc. (NASDAQ:UDMY) First-Quarter Results Are Out And Analysts Have Published New Forecasts
Investors in Udemy, Inc. (NASDAQ:UDMY) had a good week, as its shares rose 2.5% to close at US$10.14 following the release of its first-quarter results. It looks like the results were pretty good overall. While revenues of US$197m were in line with analyst predictions, statutory losses were much smaller than expected, with Udemy losing US$0.12 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Udemy after the latest results.
Check out our latest analysis for Udemy
After the latest results, the eleven analysts covering Udemy are now predicting revenues of US$799.1m in 2024. If met, this would reflect a modest 6.6% improvement in revenue compared to the last 12 months. Losses are expected to hold steady at around US$0.52. Before this latest report, the consensus had been expecting revenues of US$802.5m and US$0.57 per share in losses. 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 held steady at US$14.61, seeming to indicate that business is performing in line with expectations. 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 Udemy, with the most bullish analyst valuing it at US$20.00 and the most bearish at US$11.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Udemy's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 9.0% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 11% 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 Udemy.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Udemy's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Udemy 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 3 warning signs for Udemy 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.
