US$10.50 - That's What Analysts Think Cumulus Media Inc. (NASDAQ:CMLS) Is Worth After These Results
It's been a sad week for Cumulus Media Inc. (NASDAQ:CMLS), who've watched their investment drop 11% to US$3.74 in the week since the company reported its full-year result. Revenues were in line with expectations, at US$845m, while statutory losses ballooned to US$6.83 per share. 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.
See our latest analysis for Cumulus Media
Following the latest results, Cumulus Media's three analysts are now forecasting revenues of US$863.2m in 2024. This would be an okay 2.2% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 75% to US$1.80. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$883.6m and losses of US$0.30 per share in 2024. So it's pretty clear the analysts have mixed opinions on Cumulus Media after this update; revenues were downgraded and per-share losses expected to increase.
The analysts lifted their price target 8.6% to US$10.50, implicitly signalling that lower earnings per share are not expected to have a longer-term impact on the stock's value. 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. Currently, the most bullish analyst values Cumulus Media at US$11.00 per share, while the most bearish prices it at US$10.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Cumulus Media is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Cumulus Media's past performance and to peers in the same industry. For example, we noticed that Cumulus Media's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 2.2% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 5.2% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 3.6% per year. So although Cumulus Media's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Cumulus Media going out to 2026, and you can see them free on our platform here..
However, before you get too enthused, we've discovered 1 warning sign for Cumulus Media that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
