Nearmap Ltd (ASX:NEA) Just Released Its Interim Results And Analysts Are Updating Their Estimates

Nearmap Ltd (ASX:NEA) Just Released Its Interim Results And Analysts Are Updating Their Estimates

Nearmap Ltd (ASX:NEA) just released its half-year report and things are looking bullish. Results overall were credible, with revenues arriving 4.7% better than analyst forecasts at AU$68m. Higher revenues also resulted in lower statutory losses, which were AU$0.024 per share, some 4.7% 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Nearmap


ASX:NEA Earnings and Revenue Growin February 20th 2022


After the latest results, the seven analysts covering Nearmap are now predicting revenues of AU$142.9m in 2022. If met, this would reflect a decent 13% improvement in sales compared to the last 12 months. Losses are forecast to balloon 35% to AU$0.058 per share. Before this earnings announcement, the analysts had been modelling revenues of AU$140.4m and losses of AU$0.051 per share in 2022. While this year's revenue estimates held steady, there was also a noticeable increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.

The consensus price target held steady at AU$2.47, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Nearmap analyst has a price target of AU$4.49 per share, while the most pessimistic values it at AU$1.30. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2022 brings more of the same, according to the analysts, with revenue forecast to display 28% growth on an annualised basis. That is in line with its 24% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 18% per year. So it's pretty clear that Nearmap is forecast to grow substantially faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at AU$2.47, 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 Nearmap going out to 2024, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Nearmapthat you should be aware of.