UserTesting, Inc. (NYSE:USER) First-Quarter Results Just Came Out: Here's What Analysts Are Forecasting For This Year
UserTesting, Inc. (NYSE:USER) just released its latest quarterly results and things are looking bullish. Results overall were solid, with revenues arriving 5.2% better than analyst forecasts at US$46m. Higher revenues also resulted in substantially lower statutory losses which, at US$0.11 per share, were 5.2% smaller than the analysts expected. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for UserTesting
Following the latest results, UserTesting's eleven analysts are now forecasting revenues of US$199.3m in 2022. This would be a substantial 23% improvement in sales compared to the last 12 months. Losses are forecast to balloon 71% to US$0.64 per share. Before this latest report, the consensus had been expecting revenues of US$196.7m and US$0.67 per share in losses. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.
The average price target held steady at US$13.40, seeming to indicate that business is performing in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic UserTesting analyst has a price target of US$16.00 per share, while the most pessimistic values it at US$11.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
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. It's pretty clear that there is an expectation that UserTesting's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 32% growth on an annualised basis. This is compared to a historical growth rate of 47% over the past year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 14% per year. So it's pretty clear that, while UserTesting's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. The consensus price target held steady at US$13.40, with the latest estimates not enough to have an impact on their price targets.
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 UserTesting going out to 2024, and you can see them free on our platform here..
You still need to take note of risks, for example - UserTesting has 3 warning signs (and 1 which is a bit unpleasant) we think you should know about.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
