The analysts might have been a bit too bullish on Loyalty Ventures Inc. (NASDAQ:LYLT), given that the company fell short of expectations when it released its quarterly results last week. It looks like quite a negative result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of US$155m missed by 11%, and statutory earnings per share of US$0.04 fell short of forecasts by 85%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for Loyalty Ventures
Taking into account the latest results, the current consensus from Loyalty Ventures' twin analysts is for revenues of US$756.6m in 2022, which would reflect a satisfactory 6.0% increase on its sales over the past 12 months. Loyalty Ventures is also expected to turn profitable, with statutory earnings of US$1.28 per share. Before this earnings report, the analysts had been forecasting revenues of US$774.9m and earnings per share (EPS) of US$2.67 in 2022. The analysts seem less optimistic after the recent results, reducing their sales forecasts and making a large cut to earnings per share numbers.
Despite the cuts to forecast earnings, there was no real change to the US$32.50 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.
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. For example, we noticed that Loyalty Ventures' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 8.1% growth to the end of 2022 on an annualised basis. That is well above its historical decline of 6.9% a year over the past year. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 3.8% per year. Not only are Loyalty Ventures' revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Loyalty Ventures. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster 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.