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Analysts Just Shipped A Captivating Upgrade To Their J2 Global, Inc. (NASDAQ:JCOM) Estimates

Simply Wall St
·3 min read

Celebrations may be in order for J2 Global, Inc. (NASDAQ:JCOM) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 16% to US$78.59 in the last 7 days. We'll be curious to see if these new estimates convince the market to lift the stock price higher still.

Following the upgrade, the current consensus from J2 Global's eleven analysts is for revenues of US$1.6b in 2021 which - if met - would reflect a solid 14% increase on its sales over the past 12 months. Per-share earnings are expected to expand 15% to US$5.16. Prior to this update, the analysts had been forecasting revenues of US$1.5b and earnings per share (EPS) of US$4.11 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for J2 Global

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earnings-and-revenue-growth

With these upgrades, we're not surprised to see that the analysts have lifted their price target 7.0% to US$105 per share. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values J2 Global at US$134 per share, while the most bearish prices it at US$90.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await J2 Global shareholders.

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. We can infer from the latest estimates that forecasts expect a continuation of J2 Global'shistorical trends, as next year's 14% revenue growth is roughly in line with 14% annual revenue growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 13% next year. So although J2 Global is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for next year. They also upgraded their revenue forecasts, although the latest estimates suggest that J2 Global will grow in line with the overall market. With a serious upgrade to expectations and a rising price target, it might be time to take another look at J2 Global.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for J2 Global going out to 2023, and you can see them free on our platform here..

We also provide an overview of the J2 Global Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.