Investors in Bilibili Inc. (NASDAQ:BILI) had a good week, as its shares rose 5.4% to close at US$32.70 following the release of its quarterly results. The results don't look great, especially considering that statutory losses grew 69% toCN¥1.62 per share. Revenues of CN¥2.3b did beat expectations by 5.9%, but it looks like a bit of a cold comfort. Following the result, the analysts have 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 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 most recent consensus for Bilibili from 21 analysts is for revenues of CN¥11.0b in 2020 which, if met, would be a sizeable 42% increase on its sales over the past 12 months. Per-share losses are supposed to see a sharp uptick, reaching CN¥5.80. Before this latest report, the consensus had been expecting revenues of CN¥10.4b and CN¥5.23 per share in losses. While this year's revenue estimates increased, there was also a loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
It will come as a surprise to learn that the consensus price target rose 24% to CN¥249, with the analysts clearly more interested in growing revenue, even as losses intensify. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Bilibili, with the most bullish analyst valuing it at CN¥43.04 and the most bearish at CN¥19.94 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Bilibili's revenue growth will slow down substantially, with revenues next year expected to grow 42%, compared to a historical growth rate of 66% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 13% next year. Even after the forecast slowdown in growth, it seems obvious that Bilibili 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. 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 analysts 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. We have forecasts for Bilibili going out to 2024, and you can see them free on our platform here.
Plus, you should also learn about the 3 warning signs we've spotted with Bilibili .
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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. Thank you for reading.