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It's been a pretty great week for Boingo Wireless, Inc. (NASDAQ:WIFI) shareholders, with its shares surging 16% to US$14.10 in the week since its latest annual results. The results overall were pretty much dead in line with analyst forecasts; revenues were US$237m and statutory losses were US$0.38 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the consensus forecast from Boingo Wireless' seven analysts is for revenues of US$247.2m in 2021, which would reflect a modest 4.1% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 29% to US$0.27. Before this earnings announcement, the analysts had been modelling revenues of US$247.6m and losses of US$0.25 per share in 2021. So it's pretty clear consensus is mixed on Boingo Wireless after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a moderate increase in per-share loss expectations.
The consensus price target fell 6.5% to US$18.38per share, with the analysts clearly concerned by ballooning 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. The most optimistic Boingo Wireless analyst has a price target of US$23.25 per share, while the most pessimistic values it at US$14.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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. We would highlight that Boingo Wireless' revenue growth is expected to slow, with the forecast 4.1% annualised growth rate until the end of 2021 being well below the historical 13% p.a. growth over the last five years. Compare this to the 24 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.4% per year. Factoring in the forecast slowdown in growth, it looks like Boingo Wireless is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Boingo Wireless. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Boingo Wireless' future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Boingo Wireless going out to 2024, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 1 warning sign for Boingo Wireless you should know about.
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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