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Last week, you might have seen that Weibo Corporation (NASDAQ:WB) released its first-quarter result to the market. The early response was not positive, with shares down 9.2% to US$8.77 in the past week. Overall the results were a little better than the analysts were expecting, with revenues beating forecasts by 2.1%to hit US$395m. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for Weibo
Taking into account the latest results, the current consensus from Weibo's 24 analysts is for revenues of US$1.79b in 2024. This would reflect a modest 2.6% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 9.4% to US$1.31. In the lead-up to this report, the analysts had been modelling revenues of US$1.79b and earnings per share (EPS) of US$1.39 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$12.14, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. The most optimistic Weibo analyst has a price target of US$18.80 per share, while the most pessimistic values it at US$8.60. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Weibo's growth to accelerate, with the forecast 3.5% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.3% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 10% per year. So it's clear that despite the acceleration in growth, Weibo is expected to grow meaningfully slower than the industry average.