The investors in Remitly Global, Inc.'s (NASDAQ:RELY) will be rubbing their hands together with glee today, after the share price leapt 22% to US$17.95 in the week following its third-quarter results. Remitly Global beat expectations by 5.0% with revenues of US$337m. It also surprised on the earnings front, with an unexpected statutory profit of US$0.01 per share a nice improvement on the losses that the analysts forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following the latest results, Remitly Global's eight analysts are now forecasting revenues of US$1.56b in 2025. This would be a substantial 33% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 71% to US$0.098. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$1.56b and losses of US$0.052 per share in 2025. While next year's revenue estimates held steady, there was also a sizeable expansion in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
Despite expectations of heavier losses next year,the analysts have lifted their price target 12% to US$23.22, perhaps implying these losses are not expected to be recurring over the long term. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Remitly Global at US$30.00 per share, while the most bearish prices it at US$16.00. 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.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Remitly Global's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 25% growth on an annualised basis. This is compared to a historical growth rate of 36% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.7% annually. Even after the forecast slowdown in growth, it seems obvious that Remitly Global is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
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 Remitly Global going out to 2026, and you can see them free on our platform here.
Plus, you should also learn about the 1 warning sign we've spotted with Remitly Global .
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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.
