SkyWater Technology Reports Quarterly Results Amidst Analyst Concerns
SkyWater Technology, Inc. (NASDAQ:SKYT) released its quarterly results last week, revealing revenues of $61 million, aligning with analyst expectations. However, while losses of $0.15 per share were 12% less than anticipated, analysts remain divided on the company’s future prospects.
Following the earnings announcement, analysts revised their earnings models, now predicting revenues of $302.8 million for 2025—a projected 6.5% decline compared to previous estimates. Losses are expected to increase significantly, with forecasts indicating a jump to $0.26 per share, up 46% from current levels.
The consensus price target for SkyWater has dropped by 6.3% to $11.80, reflecting a more pessimistic sentiment among analysts, largely due to the revenue estimation cut. Notably, there’s a wider range of opinions on valuation, with the most optimistic analyst setting a target of $15.00 while the most bearish suggests $8.00.
In comparison to industry peers, SkyWater’s revenue growth outlook is bleak. While it experienced a robust 23% annual growth over the past five years, projected figures indicate an annualized decline of 8.6% by 2025. In contrast, competitors within the same sector are expected to grow at an average rate of 16% annually.
Despite these concerning forecasts, analysts have not altered predictions for losses next year, highlighting the erosion of revenue estimates. Cautions exist, with three warning signs identified for potential investors to consider.
Though the company faces challenges, long-term profitability remains crucial for value creation. As analysts extend estimates to 2027, a clearer picture of SkyWater’s trajectory may emerge. Investors should remain informed and weigh their options carefully amid these shifting expectations.
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