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There's been a notable change in appetite for Xometry, Inc. (NASDAQ:XMTR) shares in the week since its quarterly report, with the stock down 13% to US$30.35. The results were mixed overall, with revenues slightly ahead of analyst estimates at US$84m. Statutory losses by contrast were 2.2% larger than predictions at US$0.43 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the consensus forecast from Xometry's eight analysts is for revenues of US$396.9m in 2022, which would reflect a huge 82% improvement in sales compared to the last 12 months. Losses are expected to increase slightly, to US$1.37 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$396.6m and losses of US$1.31 per share in 2022. So it's pretty clear consensus is mixed on Xometry after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a pronounced increase to per-share loss expectations.
With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 12% to US$57.43, with the analysts signalling that growing losses would be a definite concern. 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. The most optimistic Xometry analyst has a price target of US$100.00 per share, while the most pessimistic values it at US$43.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Xometry's past performance and to peers in the same industry. It's clear from the latest estimates that Xometry's rate of growth is expected to accelerate meaningfully, with the forecast 122% annualised revenue growth to the end of 2022 noticeably faster than its historical growth of 54% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 14% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Xometry is expected to grow much faster than its 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 Xometry. 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 Xometry. Long-term earnings power is much more important than next year's profits. We have forecasts for Xometry going out to 2024, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Xometry , and understanding them should be part of your investment process.
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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.