US$13.83 - That's What Analysts Think the Rubicon Project, Inc. Is Worth After These Results

It's been a sad week for the Rubicon Project, Inc. (NYSE:RUBI), who've watched their investment drop 15% to US$10.67 in the week since the company reported its annual result. Rubicon Project reported revenues of US$156m, in line with expectations, but it unfortunately also reported (statutory) losses of US$0.48 per share, which were slightly larger than expected. Earnings are an important time for investors, as they can track a company's performance, look at what top 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 analysts have changed their mind on Rubicon Project after the latest results.

View our latest analysis for Rubicon Project

Taking into account the latest results, the current consensus from Rubicon Project's three analysts is for revenues of US$180.9m in 2020, which would reflect a solid 16% increase on its sales over the past 12 months. Per-share statutory losses are expected to see a sharp uptick, reaching US$0.40. Before this earnings announcement, analysts had been forecasting revenues of US$178.0m and losses of US$0.36 per share in 2020. So there's definitely been a decline in analyst sentiment after the latest results, noting the real cut to new EPS forecasts.

Although analysts are now forecasting higher losses, the average analyst price target rose 15% to 12, which could indicate that these losses are expected to be "one-off", or analysts think they won't have a longer-term impact on the business. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Rubicon Project analyst has a price target of US$14.00 per share, while the most pessimistic values it at US$13.00. Still, with such a tight range of estimates, it suggests analysts have a pretty good idea of what they think the company is worth.

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. One thing stands out from these estimates, which is that analysts are forecasting Rubicon Project to grow faster in the future than it has in the past, with revenues expected to grow 16%. If achieved, this would be a much better result than the 9.2% annual decline over the past five years. Compare this against analyst estimates for the wider market, which suggest that (in aggregate) market revenues are expected to grow 16% next year. So it looks like Rubicon Project is expected to grow at about the same rate as the wider market.

The Bottom Line

The most obvious conclusion is that analysts made no changes to their forecasts for a loss next year. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall market. There was also a nice increase in the price target, with analysts feeling that the intrinsic value of the business is improving.

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 Rubicon Project analysts - going out to 2021, and you can see them free on our platform here.

You can also see our analysis of Rubicon Project's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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