A week ago, Copperleaf Technologies Inc. (TSE:CPLF) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. Revenues and losses per share were both better than expected, with revenues of CA$21m leading estimates by 9.2%. Statutory losses were smaller than the analystsexpected, coming in at CA$0.11 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the most recent consensus for Copperleaf Technologies from seven analysts is for revenues of CA$83.2m in 2022 which, if met, would be a meaningful 11% increase on its sales over the past 12 months. Per-share losses are expected to explode, reaching CA$0.47 per share. Before this latest report, the consensus had been expecting revenues of CA$86.0m and CA$0.50 per share in losses. 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.
The analysts have cut their price target 19% to CA$11.00per share, suggesting that the declining revenue was a more crucial indicator than the forecast reduction in 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 Copperleaf Technologies at CA$14.00 per share, while the most bearish prices it at CA$9.00. 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.
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 24% growth on an annualised basis. That is in line with its 29% annual growth over the past year. 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 although Copperleaf Technologies is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. They also downgraded their revenue estimates, although industry data suggests that Copperleaf Technologies' revenues are expected to grow faster than the wider industry. Yet - earnings are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Copperleaf Technologies' future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on Copperleaf Technologies. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Copperleaf Technologies analysts - going out to 2024, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 3 warning signs for Copperleaf Technologies (of which 1 can't be ignored!) 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.
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