Investors in Bitcoin Depot Inc. (NASDAQ:BTM) had a good week, as its shares rose 8.4% to close at US$1.67 following the release of its quarterly results. The results were positive, with revenue coming in at US$163m, beating analyst expectations by 9.6%. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the four analysts covering Bitcoin Depot provided consensus estimates of US$577.4m revenue in 2024, which would reflect a not inconsiderable 8.3% decline over the past 12 months. Statutory losses are forecast to balloon 93% to US$0.092 per share. Before this earnings report, the analysts had been forecasting revenues of US$612.3m and earnings per share (EPS) of US$0.04 in 2024. There looks to have been a significant drop in sentiment regarding Bitcoin Depot's prospects after these latest results, with a small dip in revenues and the analysts now forecasting a loss instead of a profit.
The average price target was broadly unchanged at US$4.44, perhaps implicitly signalling that the weaker earnings outlook is not expected to have a long-term impact on the 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. Currently, the most bullish analyst values Bitcoin Depot at US$7.00 per share, while the most bearish prices it at US$3.25. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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. One more thing stood out to us about these estimates, and it's the idea that Bitcoin Depot's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 16% to the end of 2024. This tops off a historical decline of 8.2% a year over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 6.7% per year. So while a broad number of companies are forecast to grow, unfortunately Bitcoin Depot is expected to see its revenue affected worse than other companies in the industry.
The Bottom Line
The biggest low-light for us was that the forecasts for Bitcoin Depot dropped from profits to a loss next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Bitcoin Depot analysts - going out to 2025, and you can see them free on our platform here.
Even so, be aware that Bitcoin Depot is showing 5 warning signs in our investment analysis , 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.
