Yahoo Finance Earnings Update: Arteris, Inc. (NASDAQ:AIP) Just Reported Its First-Quarter Results And Analysts Are Updating Their Forecasts
Shareholders will be ecstatic, with their stake up 23% over the past week following Arteris, Inc.'s (NASDAQ:AIP) latest first-quarter results. Revenue hit US$13m in line with forecasts, although the company reported a statutory loss per share of US$0.25 that was somewhat smaller than the analysts expected. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Arteris
After the latest results, the four analysts covering Arteris are now predicting revenues of US$56.1m in 2024. If met, this would reflect a satisfactory 5.0% improvement in revenue compared to the last 12 months. Losses are forecast to narrow 2.7% to US$0.94 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$56.0m and losses of US$0.97 per share in 2024. So there seems to have been a moderate uplift in analyst sentiment with the latest consensus release, given the upgrade to loss per share forecasts for this year.
There's been no major changes to the consensus price target of US$12.75, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Arteris analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$11.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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 Arteris' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 6.7% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 13% annually. Factoring in the forecast slowdown in growth, it seems obvious that Arteris is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Arteris going out to 2025, and you can see them free on our platform here..
Even so, be aware that Arteris is showing 4 warning signs in our investment analysis , you should know about...
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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.
