Ozon Holdings PLC (NASDAQ:OZON) missed earnings with its latest full-year results, disappointing overly-optimistic forecasters. Unfortunately, Ozon Holdings delivered a serious earnings miss. Revenues of US$88b were 13% below expectations, and statutory losses ballooned 43% to US$135 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 Ozon Holdings' nine analysts is for revenues of US$2.00b in 2021, which would reflect a painful 98% decline in sales compared to the last year of performance. The loss per share is expected to greatly reduce in the near future, narrowing 99% to US$1.24. Before this earnings announcement, the analysts had been modelling revenues of US$152.7b and losses of US$94.82 per share in 2021. So there's been quite a change-up of views after the recent consensus updates, withthe analysts making a serious cut to their revenue forecasts while also reducing the estimated losses the business will incur.
There was a decent 5.3% increase in the price target to ₽4,579, with the analysts clearly signalling that the expected reduction in losses is a positive, despite a weaker revenue 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. Currently, the most bullish analyst values Ozon Holdings at ₽73.81 per share, while the most bearish prices it at ₽45.88. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Ozon Holdings is an easy business to forecast or the the analysts are all using similar assumptions.
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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 98% by the end of 2021. This indicates a significant reduction from annual growth of 61% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 17% per year. It's pretty clear that Ozon Holdings' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Even so, earnings are more important to the intrinsic value of the business. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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. We have estimates - from multiple Ozon Holdings analysts - going out to 2025, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 3 warning signs for Ozon Holdings you should be aware of, and 1 of them doesn't sit too well with us.
This article by Simply Wall St is general in nature. 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.
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