HyreCar Inc. (NASDAQ:HYRE) shareholders will have a reason to smile today, with the analysts making substantial upgrades to next year’s statutory forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company’s business prospects. HyreCar has also found favour with investors, with the stock up an impressive 24% to US$9.84 over the past week. We’ll be curious to see if these new estimates convince the market to lift the stock price higher still.
Following the upgrade, the current consensus from HyreCar’s four analysts is for revenues of US$44m in 2021 which – if met – would reflect a huge 92% increase on its sales over the past 12 months. Losses are predicted to fall substantially, shrinking 92% to US$0.073. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$39m and losses of US$0.13 per share in 2021. So there’s been quite a change-up of views after the recent consensus updates, with the analysts making a sizeable increase to their revenue forecasts while also reducing the estimated loss as the business grows towards breakeven.
View our latest analysis for HyreCar
3MTYxOTk3NTYzOTQ2/https://s.yimg.com/uu/api/res/1.2/ncektt89uf5UC2HgWGBI1A–~B/aD01MjQ7dz04MjE7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/simply_wall_st__316/5bd03c454a7257e87f93e104f05f21bd”/>The consensus price target rose 66% to US$12.25, with the analysts encouraged by the higher revenue and lower forecast losses for next year. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on HyreCar, with the most bullish analyst valuing it at US$8.00 and the most bearish at US$7.00 per share. The narrow spread of estimates could suggest that the business’ future is relatively easy to value, or that the analysts have a clear view on its prospects.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting HyreCar’s growth to accelerate, with the forecast 92% growth ranking favourably alongside historical growth of 52% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.6% per year. Factoring in the forecast acceleration in revenue, it’s pretty clear that HyreCar is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that analysts reduced their loss per share estimates for next year, reflecting increased optimism around HyreCar’s prospects. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, HyreCar could be worth investigating further.
These earnings upgrades look like a sterling endorsement, but before diving in – you should know that we’ve spotted 4 potential risks with HyreCar, including a short cash runway. You can learn more, and discover the 3 other risks we’ve identified, for free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
This article by Simply Wall St is general in nature. 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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