Why Latch Stock Broke Today
Shares of Latch (NASDAQ: LTCH) stock tumbled 12.8% as of 10:45 a.m. EDT on Monday after investment bank Goldman Sachs downgraded shares of the maker of building entry security software. Analysts downgraded the stock from buy to neutral.
In the midst of a still-booming housing market, "multiple datapoints indicate significant delays in residential construction projects," warned Goldman Sachs in a note covered today on StreetInsider.com, and "we now expect supply shortages in the housing construction market to persist through H2'22."
Adding to investor worries, Goldman reported that "recent deferred revenue disclosure implies [that Latch has been awarding customers] higher discounts than we had previously been modeling." The banker now estimates that Latch products are being sold for 50% off, as opposed to prior 20%-off estimates, so Goldman is cutting its revenue forecasts for Latch by a further 29% over the next 12 months.
Source Fool.com
