Surf Air Mobility Inc. (NYSE:SRFM) Just Released Its Third-Quarter Earnings: Here's What Analysts Think
Last week, you might have seen that Surf Air Mobility Inc. (NYSE:SRFM) released its third-quarter result to the market. The early response was not positive, with shares down 7.2% to US$0.70 in the past week. The results were mixed overall, with revenues slightly ahead of analyst estimates at US$36m. Statutory losses by contrast were 9.6% larger than predictions at US$0.16 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Following the latest results, Surf Air Mobility's five analysts are now forecasting revenues of US$163.6m in 2027. This would be a major 39% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 45% to US$0.47. Before this latest report, the consensus had been expecting revenues of US$163.6m and US$0.47 per share in losses.
View our latest analysis for Surf Air Mobility
As a result there was no major change to the consensus price target of US$4.93, implying that the business is trading roughly in line with expectations despite ongoing losses. 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 Surf Air Mobility at US$12.00 per share, while the most bearish prices it at US$1.00. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
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. We would highlight that Surf Air Mobility's revenue growth is expected to slow, with the forecast 30% annualised growth rate until the end of 2027 being well below the historical 38% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.0% annually. Even after the forecast slowdown in growth, it seems obvious that Surf Air Mobility is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$4.93, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Surf Air Mobility going out to 2028, and you can see them free on our platform here.
Even so, be aware that Surf Air Mobility is showing 5 warning signs in our investment analysis , and 4 of those are a bit unpleasant...
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