Explore Smith Micro Software’s Fair Values from the Community and select yours
It’s shaping up to be a tough period for Smith Micro Software, Inc. (NASDAQ:SMSI), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. Revenues missed expectations somewhat, coming in at US$4.4m, but statutory earnings fell catastrophically short, with a loss of US$0.78 some 208% larger than what the analysts had predicted. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we’ve aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Smith Micro Software after the latest results.
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Taking into account the latest results, the current consensus from Smith Micro Software’s twin analysts is for revenues of US$19.3m in 2025. This would reflect a credible 3.2% increase on its revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 45% to US$0.81. Before this earnings announcement, the analysts had been modelling revenues of US$22.2m and losses of US$0.85 per share in 2025. We can see there’s definitely been a change in sentiment in this update, with the analysts administering a meaningful downgrade to next year’s revenue estimates, while at the same time reducing their loss estimates.
Check out our latest analysis for Smith Micro Software
The consensus price target fell 13% to US$3.50, with the dip in revenue estimates clearly souring sentiment, despite the forecast reduction in losses.
Of course, another way to look at these forecasts is to place them into context against the industry itself. For example, we noticed that Smith Micro Software’s rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 6.4% growth to the end of 2025 on an annualised basis. That is well above its historical decline of 17% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 13% annually for the foreseeable future. So although Smith Micro Software’s revenue growth is expected to improve, it is still expected to grow slower than the industry.
