Altisource Portfolio Solutions S.A. (NASDAQ:ASPS) shareholders are probably feeling a little disappointed, since its shares fell 4.2% to US$10.84 in the week after its latest first-quarter results. It was a respectable set of results; while revenues of US$40m were in line with analyst predictions, statutory losses were 19% smaller than expected, with Altisource Portfolio Solutions losing US$0.76 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the most recent consensus for Altisource Portfolio Solutions from twin analysts is for revenues of US$193.1m in 2022 which, if met, would be a solid 15% increase on its sales over the past 12 months. The company is forecast to report a statutory loss of US$3.15 in 2022, a sharp decline from a profit over the last year. Before this latest report, the consensus had been expecting revenues of US$211.6m and US$2.11 per share in losses. 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.
The analysts lifted their price target 20% to US$18.00, implicitly signalling that lower earnings per share are not expected to have a longer-term impact on the stock's value.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that Altisource Portfolio Solutions is forecast to grow faster in the future than it has in the past, with revenues expected to display 21% annualised growth until the end of 2022. If achieved, this would be a much better result than the 29% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 6.2% per year. So it looks like Altisource Portfolio Solutions is expected to grow faster than its competitors, at least for a while.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Altisource Portfolio Solutions. They also downgraded their revenue estimates, although industry data suggests that Altisource Portfolio Solutions' revenues are expected to grow faster 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.
Even so, be aware that Altisource Portfolio Solutions is showing 3 warning signs in our investment analysis , you should know about...
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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.