The full-year results for Blue Bird Corporation (NASDAQ:BLBD) were released last week, making it a good time to revisit its performance. Earnings per share fell badly short of expectations, coming in at US$0.90, some 30% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at US$1.0b. 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 forecasts to see what analysts are expecting for next year.
Taking into account the latest results, Blue Bird's dual analysts currently expect revenues in 2020 to be US$1.03b, approximately in line with the last 12 months. Earnings per share are expected to shoot up 66% to US$1.53. In the lead-up to this report, analysts had been modelling revenues of US$1.03b and earnings per share (EPS) of US$1.98 in 2020. Analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$24.50, with analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Blue Bird's past performance and to peers in the same market. It's pretty clear that analysts expect Blue Bird's revenue growth will slow down substantially, with revenues next year expected to grow 1.0%, compared to a historical growth rate of 3.8% over the past five years. By way of comparison, other companies in this market with analyst coverage, are forecast to grow their revenue at 1.7% per year. So it's pretty clear that, while revenue growth is expected to slow down, analysts still expect the wider market to grow faster than Blue Bird.
The Bottom Line
The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Blue Bird. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Blue Bird's revenues are expected to perform worse than the wider market. The consensus price target held steady at US$24.50, with the latest estimates not enough to have an impact on analysts' estimated valuations.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Blue Bird going out as far as 2021, and you can see them free on our platform here.
You can also see whether Blue Bird is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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