Shareholders might have noticed that Clarivate Plc (NYSE:CLVT) filed its first-quarter result this time last week. The early response was not positive, with shares down 8.8% to US$6.25 in the past week. Revenues were in line with expectations, at US$621m, while statutory losses ballooned to US$0.14 per share. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following last week's earnings report, Clarivate's nine analysts are forecasting 2024 revenues to be US$2.61b, approximately in line with the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 93% to US$0.12. Before this earnings announcement, the analysts had been modelling revenues of US$2.62b and losses of US$0.11 per share in 2024. So it's pretty clear consensus is mixed on Clarivate after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a moderate increase in per-share loss expectations.
As a result, there was no major change to the consensus price target of US$8.03, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast 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 Clarivate at US$10.00 per share, while the most bearish prices it at US$6.00. 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.
Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.6% by the end of 2024. This indicates a significant reduction from annual growth of 25% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.7% per year. It's pretty clear that Clarivate's revenues are expected to perform substantially worse than the wider 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 Clarivate. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Clarivate's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 Clarivate going out to 2026, and you can see them free on our platform here..
You can also view our analysis of Clarivate's balance sheet, and whether we think Clarivate is carrying too much debt, for free on our platform here.
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.