Analysts Are Upgrading CooTek (Cayman) Inc. (NYSE:CTK) After Its Latest Results
CooTek (Cayman) Inc. (NYSE:CTK) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The results were impressive, with revenues of US$107m exceeding analyst forecasts by 25%, and statutory losses of US$0.16 were likewise much smaller than the analyst had forecast. Following the result, the analyst has updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.
View our latest analysis for CooTek (Cayman)
After the latest results, the single analyst covering CooTek (Cayman) are now predicting revenues of US$545.6m in 2020. If met, this would reflect a huge 123% improvement in sales compared to the last 12 months. CooTek (Cayman) is also expected to turn profitable, with statutory earnings of US$0.54 per share. Yet prior to the latest earnings, the analyst had been anticipated revenues of US$482.0m and earnings per share (EPS) of US$0.46 in 2020. There has definitely been an improvement in perception after these results, with the analyst noticeably increasing both their earnings and revenue estimates.
With these upgrades, we're not surprised to see that the analyst has lifted their price target 6.1% to US$8.65 per share.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that CooTek (Cayman)'s rate of growth is expected to accelerate meaningfully, with the forecast 123% revenue growth noticeably faster than its historical growth of 61% over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 12% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect CooTek (Cayman) to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards CooTek (Cayman) following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2021, which can be seen for free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with CooTek (Cayman) .
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