Cipher Mining Inc. (NASDAQ:CIFR) missed earnings with its latest third-quarter results, disappointing overly-optimistic forecasters. It was a pretty negative result overall, with revenues of US$30m missing analyst predictions by 9.5%. Worse, the business reported a statutory loss of US$0.07 per share, much larger than the analysts had forecast prior to the result. 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. Readers will be glad to know we’ve aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Cipher Mining after the latest results.
Taking into account the latest results, the consensus forecast from Cipher Mining’s seven analysts is for revenues of US$148.3m in 2024. This reflects a major 71% improvement in revenue compared to the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 75% to US$0.085. Before this latest report, the consensus had been expecting revenues of US$147.1m and US$0.085 per share in losses.
As a result there was no major change to the consensus price target of US$5.17, implying that the business is trading roughly in line with expectations despite ongoing losses. 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. The most optimistic Cipher Mining analyst has a price target of US$6.00 per share, while the most pessimistic values it at US$4.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Cipher Mining shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Cipher Mining’s past performance and to peers in the same industry. It’s pretty clear that there is an expectation that Cipher Mining’s revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 54% growth on an annualised basis. This is compared to a historical growth rate of 149% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% annually. Even after the forecast slowdown in growth, it seems obvious that Cipher Mining is also expected to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that the analysts made no changes to their forecasts for a loss 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$5.17, with the latest estimates not enough to have an impact on their price targets.
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 Cipher Mining going out to 2025, and you can see them free on our platform here.
You should always think about risks though. Case in point, we’ve spotted 4 warning signs for Cipher Mining you should be aware of.
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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.