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Shareholders of iHeartMedia, Inc. (NASDAQ:IHRT) will be pleased this week, given that the stock price is up 13% to US$1.23 following its latest first-quarter results. Revenues of US$807m beat expectations by a respectable 2.5%, although statutory losses per share increased. iHeartMedia lost US$1.84, which was 255% more than what the analysts had included in their models. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
After the latest results, the consensus from iHeartMedia's five analysts is for revenues of US$3.76b in 2025, which would reflect a measurable 2.7% decline in revenue compared to the last year of performance. Losses are predicted to fall substantially, shrinking 94% to US$0.54. Before this latest report, the consensus had been expecting revenues of US$3.78b and US$0.55 per share in losses.
Check out our latest analysis for iHeartMedia
As a result, it's unexpected to see that the consensus price target fell 14% to US$2.45, with the analysts seemingly becoming more concerned about ongoing losses, despite making no major changes to their forecasts. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values iHeartMedia at US$4.50 per share, while the most bearish prices it at US$1.25. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on 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. We would highlight that revenue is expected to reverse, with a forecast 3.6% annualised decline to the end of 2025. That is a notable change from historical growth of 4.3% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 2.9% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - iHeartMedia is expected to lag the wider industry.