There's been a major selloff in Vivid Seats Inc. (NASDAQ:SEAT) shares in the week since it released its quarterly report, with the stock down 50% to US$1.42. It was an okay report, and revenues came in at US$127m, approximately in line with analyst estimates leading up to the results announcement. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Following last week's earnings report, Vivid Seats' eight analysts are forecasting 2027 revenues to be US$506.4m, approximately in line with the last 12 months. Losses are predicted to fall substantially, shrinking 89% to US$3.15. Before this earnings announcement, the analysts had been modelling revenues of US$517.4m and losses of US$2.99 per share in 2027. Overall it looks as though the analysts are negative in this update. Although revenue forecasts held steady, the consensus also made a pronounced increase to to its losses per share forecasts.
View our latest analysis for Vivid Seats
The average price target fell 46% to US$6.13, implicitly signalling that lower earnings per share are a leading indicator for Vivid Seats' valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Vivid Seats analyst has a price target of US$16.00 per share, while the most pessimistic values it at US$1.75. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 0.5% annualised decline to the end of 2027. That is a notable change from historical growth of 3.9% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 8.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Vivid Seats is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Vivid Seats' future valuation.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Vivid Seats going out to 2028, and you can see them free on our platform here.
You still need to take note of risks, for example - Vivid Seats has 5 warning signs (and 1 which is significant) we think you should know about.
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