This Analyst Just Wrote A Brand New Outlook For Studio City International Holdings Limited's (NYSE:MSC) Business
Shareholders in Studio City International Holdings Limited (NYSE:MSC) may be thrilled to learn that the covering analyst has just delivered a major upgrade to their near-term forecasts. The analyst greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.
Following the upgrade, the current forecast from Studio City International Holdings' solo analyst is for revenues of US$358m in 2023, which would reflect a major improvement in sales compared to the last 12 months. The loss per share is anticipated to greatly reduce in the near future, narrowing 24% to US$1.29. However, before this estimates update, the consensus had been expecting revenues of US$203m and US$1.97 per share in losses. We can see there's definitely been a change in sentiment in this update, with the analyst administering a sizeable upgrade to this year's revenue estimates, while at the same time reducing their loss estimates.
View our latest analysis for Studio City International Holdings
The consensus price target rose 21% to US$7.50, with the analyst encouraged by the higher revenue and lower forecast losses for this year.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. For example, we noticed that Studio City International Holdings' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 25x growth to the end of 2023 on an annualised basis. That is well above its historical decline of 44% a year 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 11% per year. Not only are Studio City International Holdings' revenues expected to improve, it seems that the analyst is also expecting it to grow faster than the wider industry.
The Bottom Line
The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Studio City International Holdings is moving incrementally towards profitability. Fortunately, the analyst also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at Studio City International Holdings.
The covering analyst is clearly in love with Studio City International Holdings at the moment, but before diving in - you should be aware that we've identified some warning flags with the business, such as major dilution from new stock issuance in the past year. For more information, you can click through to our platform to learn more about this and the 3 other warning signs we've identified .
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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.
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