Adelaide Brighton Limited Annual Results: Here's What Analysts Are Forecasting For Next Year
Adelaide Brighton Limited (ASX:ABC) shares fell 3.5% to AU$3.06 in the week since its latest annual results. It looks like the results were a bit of a negative overall. While revenues of AU$1.5b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 4.6% to hit AU$0.072 per share. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what analysts are expecting for next year.
Check out our latest analysis for Adelaide Brighton
After the latest results, the consensus from Adelaide Brighton's ten analysts is for revenues of AU$1.44b in 2020, which would reflect a small 5.3% decline in sales compared to the last year of performance. Statutory earnings per share are expected to soar 129% to AU$0.17. In the lead-up to this report, analysts had been modelling revenues of AU$1.48b and earnings per share (EPS) of AU$0.19 in 2020. From this we can that analyst sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.
Analysts made no major changes to their price target of AU$3.25, suggesting the downgrades are not expected to have a long-term impact on Adelaide Brighton's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Adelaide Brighton, with the most bullish analyst valuing it at AU$4.00 and the most bearish at AU$2.60 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Adelaide Brighton's past performance and to peers in the same market. We would highlight that sales are expected to reverse, with the forecast 5.3% revenue decline a notable change from historical growth of 3.6% over the last five years. Compare this with our data, which suggests that other companies in the same market are, in aggregate, expected to see their revenue grow 5.6% next year. It's pretty clear that Adelaide Brighton's revenues are expected to perform substantially worse than the wider market.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider market. The consensus price target held steady at AU$3.25, with the latest estimates not enough to have an impact on analysts' estimated valuations.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Adelaide Brighton going out to 2024, and you can see them free on our platform here..
You can also see whether Adelaide Brighton is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
