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Investors in LuxUrban Hotels Inc. (NASDAQ:LUXH) had a good week, as its shares rose 9.3% to close at US$2.59 following the release of its yearly results. Revenues were in line with expectations, at US$44m, while statutory losses ballooned to US$0.40 per share. 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. 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 LuxUrban Hotels
Following the latest results, LuxUrban Hotels' two analysts are now forecasting revenues of US$126.3m in 2023. This would be a major 188% improvement in sales compared to the last 12 months. Earnings are expected to improve, with LuxUrban Hotels forecast to report a statutory profit of US$0.29 per share. Before this earnings report, the analysts had been forecasting revenues of US$121.1m and earnings per share (EPS) of US$0.39 in 2023. So it's pretty clear the analysts have mixed opinions on LuxUrban Hotels after the latest results; even though they upped their revenue numbers, it came at the cost of a pretty serious reduction to per-share earnings expectations.
The analysts also upgraded LuxUrban Hotels' price target 7.1% to US$7.50, implying that the higher sales are expected to generate enough value to offset the forecast decline in earnings.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that LuxUrban Hotels' rate of growth is expected to accelerate meaningfully, with the forecast 188% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 51% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.1% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect LuxUrban Hotels to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than 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.