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Quarterhill Inc. (TSE:QTRH) just released its latest first-quarter report and things are not looking great. Revenues missed expectations somewhat, coming in at US$33m, but statutory earnings fell catastrophically short, with a loss of US$0.068 some 128% larger than what the analysts had predicted. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
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Following the latest results, Quarterhill's three analysts are now forecasting revenues of US$159.6m in 2025. This would be a reasonable 4.8% improvement in revenue compared to the last 12 months. Losses are expected to hold steady at around US$0.13. Before this earnings announcement, the analysts had been modelling revenues of US$169.1m and losses of US$0.045 per share in 2025. While this year's revenue estimates dropped there was also a massive increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
See our latest analysis for Quarterhill
The consensus price target fell 6.4% to CA$1.95, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Quarterhill, with the most bullish analyst valuing it at CA$2.00 and the most bearish at CA$1.85 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Quarterhill's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 6.4% growth on an annualised basis. This is compared to a historical growth rate of 9.7% over the past five years. Compare this to the 9 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 5.1% per year. Factoring in the forecast slowdown in growth, it looks like Quarterhill is forecast to grow at about the same rate as the wider industry.