It's been a mediocre week for AvidXchange Holdings, Inc. (NASDAQ:AVDX) shareholders, with the stock dropping 18% to US$7.60 in the week since its latest yearly results. It looks like a credible result overall - although revenues of US$439m were what the analysts expected, AvidXchange Holdings surprised by delivering a (statutory) profit of US$0.04 per share, an impressive 41% above what was forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for AvidXchange Holdings
Following the latest results, AvidXchange Holdings' 16 analysts are now forecasting revenues of US$457.9m in 2025. This would be a modest 4.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 75% to US$0.07. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$483.1m and earnings per share (EPS) of US$0.11 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.
It'll come as no surprise then, to learn that the analysts have cut their price target 20% to US$9.63. 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. The most optimistic AvidXchange Holdings analyst has a price target of US$13.00 per share, while the most pessimistic values it at US$7.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying 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. It's pretty clear that there is an expectation that AvidXchange Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 4.3% growth on an annualised basis. This is compared to a historical growth rate of 21% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.2% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than AvidXchange Holdings.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for AvidXchange Holdings going out to 2027, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with AvidXchange Holdings .
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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.
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