Apogee Enterprises, Inc. (NASDAQ:APOG) just released its latest third-quarter report and things are not looking great. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$338m, statutory earnings missed forecasts by an incredible 25%, coming in at just US$0.57 per share. 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. So we gathered the latest post-earnings forecasts to see what analysts' statutory forecasts suggest is in store for next year.
Taking into account the latest results, the most recent consensus for Apogee Enterprises from five analysts is for revenues of US$1.46b in 2021, which is an okay 4.9% increase on its sales over the past 12 months. Statutory earnings per share are expected to soar 130% to US$3.26. Before this earnings report, analysts had been forecasting revenues of US$1.51b and earnings per share (EPS) of US$3.58 in 2021. It's pretty clear that analyst sentiment has fallen after the latest results, leading to lower revenue forecasts and a small dip in earnings per share estimates.
It'll come as no surprise then, to learn that analysts have cut their price target 7.7% to US$41.83. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Apogee Enterprises, with the most bullish analyst valuing it at US$50.00 and the most bearish at US$35.00 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 Apogee Enterprises's past performance and to peers in the same market. It's pretty clear that analysts expect Apogee Enterprises's revenue growth will slow down substantially, with revenues next year expected to grow 4.9%, compared to a historical growth rate of 10% over the past five years. Compare this to the other companies in this market with analyst coverage, which are forecast to grow their revenue at 4.1% per year. Factoring in the forecast slowdown in growth, it looks like analysts are expecting Apogee Enterprises to grow at about the same rate as 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. Analysts also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by the latest results, leading to a lower estimate of Apogee Enterprises's future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on Apogee Enterprises. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Apogee Enterprises going out to 2022, and you can see them free on our platform here..
You can also see whether Apogee Enterprises is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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