Earnings Release: Here's Why Analysts Cut Their Mondee Holdings, Inc. (NASDAQ:MOND) Price Target To US$4.30
It's been a mediocre week for Mondee Holdings, Inc. (NASDAQ:MOND) shareholders, with the stock dropping 10% to US$2.21 in the week since its latest full-year results. Revenue of US$222m came in 2.7% ahead of expectations, although statutory earnings didn't fare nearly so well, recording a loss of US$0.93, a 15% miss. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Mondee Holdings
After the latest results, the five analysts covering Mondee Holdings are now predicting revenues of US$251.8m in 2024. If met, this would reflect a solid 13% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 53% to US$0.41. Before this latest report, the consensus had been expecting revenues of US$251.6m and US$0.34 per share in losses. So it's pretty clear the analysts have mixed opinions on Mondee Holdings even after this update; although they reconfirmed their revenue numbers, it came at the cost of a sizeable expansion in per-share losses.
The consensus price target fell 21% to US$4.30per share, with the analysts clearly concerned by ballooning losses. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Mondee Holdings at US$7.00 per share, while the most bearish prices it at US$2.90. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Mondee Holdings' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 34% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.7% annually. Even after the forecast slowdown in growth, it seems obvious that Mondee 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. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that in mind, we wouldn't be too quick to come to a conclusion on Mondee Holdings. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Mondee Holdings analysts - going out to 2026, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 3 warning signs for Mondee 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.
