Analysts Have Made A Financial Statement On Fathom Holdings Inc.'s (NASDAQ:FTHM) Annual Report
It's been a sad week for Fathom Holdings Inc. (NASDAQ:FTHM), who've watched their investment drop 20% to US$2.16 in the week since the company reported its full-year result. Revenues came in at US$345m, in line with expectations, while statutory losses per share were substantially higher than expected, at US$1.47 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Fathom Holdings after the latest results.
Check out our latest analysis for Fathom Holdings
After the latest results, the three analysts covering Fathom Holdings are now predicting revenues of US$396.8m in 2024. If met, this would reflect a solid 15% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 28% to US$0.83. Before this earnings announcement, the analysts had been modelling revenues of US$403.8m and losses of US$0.73 per share in 2024. So it's pretty clear the analysts have mixed opinions on Fathom Holdings even after this update; although they reconfirmed their revenue numbers, it came at the cost of a notable increase in per-share losses.
As a result, there was no major change to the consensus price target of US$7.00, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. 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. There are some variant perceptions on Fathom Holdings, with the most bullish analyst valuing it at US$12.00 and the most bearish at US$4.50 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
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. It's pretty clear that there is an expectation that Fathom Holdings' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 15% growth on an annualised basis. This is compared to a historical growth rate of 32% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 10% annually. Even after the forecast slowdown in growth, it seems obvious that Fathom Holdings is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$7.00, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Fathom Holdings 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 5 warning signs for Fathom Holdings 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.
