Analysts Have Been Trimming Their Slack Technologies, Inc. (NYSE:WORK) Price Target After Its Latest Report
NYSE:WORK) just released its latest second-quarter results and things are looking bullish. It looks like a positive result overall, with revenues of US$216m beating forecasts by 3.2%. Statutory losses of US$0.13 per share were 3.2% smaller than the analysts expected, likely helped along by the higher revenues. 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. With this in mind, we’ve gathered the latest statutory forecasts to see what the analysts are expecting for next year.” data-reactid=”28″>Slack Technologies, Inc. (NYSE:WORK) just released its latest second-quarter results and things are looking bullish. It looks like a positive result overall, with revenues of US$216m beating forecasts by 3.2%. Statutory losses of US$0.13 per share were 3.2% smaller than the analysts expected, likely helped along by the higher revenues. 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. With this in mind, we’ve gathered the latest statutory forecasts to see what the analysts are expecting for next year.
View our latest analysis for Slack Technologies ” data-reactid=”29″> View our latest analysis for Slack Technologies
Taking into account the latest results, the most recent consensus for Slack Technologies from 21 analysts is for revenues of US$877.8m in 2021 which, if met, would be a decent 14% increase on its sales over the past 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.57. Before this earnings announcement, the analysts had been modelling revenues of US$873.1m and losses of US$0.59 per share in 2021. 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.
Even with the lower forecast losses, the analysts lowered their valuations, with the average price target falling 11% to US$30.14. It looks likethe analysts have become less optimistic about the overall business. There’s another way to think about price targets though, and that’s to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Slack Technologies at US$40.00 per share, while the most bearish prices it at US$20.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Slack Technologies’ revenue growth is expected to slow, with forecast 14% increase next year well below the historical 51% growth over the last year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 12% next year. So it’s pretty clear that, while Slack Technologies’ revenue growth is expected to slow, it’s expected to grow roughly in line with the industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall 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.
see them free on our platform here.” data-reactid=”51″>Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year’s earnings. We have estimates – from multiple Slack Technologies analysts – going out to 2023, and you can see them free on our platform here.
4 warning signs we’ve spotted with Slack Technologies .” data-reactid=”56″>Plus, you should also learn about the 4 warning signs we’ve spotted with Slack Technologies .
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”57″>This article by Simply Wall St is general in nature. 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected].
