BrightView Holdings, Inc. (NYSE:BV) shares fell 9.1% to US$16.89 in the week since its latest full-year results. Revenues of US$2.4b were in line with forecasts, although earnings per share (EPS) came in below expectations at US$0.43, missing estimates by 8.5%. 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, the current consensus from BrightView Holdings's eight analysts is for revenues of US$2.49b in 2020, which would reflect a credible 3.5% increase on its sales over the past 12 months. Earnings per share are expected to surge 36% to US$0.59. Yet prior to the latest earnings, analysts had been forecasting revenues of US$2.50b and earnings per share (EPS) of US$0.71 in 2020. So there's definitely been a decline in analyst sentiment after the latest results, noting the real cut to new EPS forecasts.
The consensus price target held steady at US$19.88, with analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. The most optimistic BrightView Holdings analyst has a price target of US$23.00 per share, while the most pessimistic values it at US$18.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that analysts have a clear view on its prospects.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that analysts are expecting a continuation of BrightView Holdings's historical trends, as next year's forecast 3.5% revenue growth is roughly in line with 3.1% annual revenue growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 5.7% per year. So although BrightView Holdings is expected to maintain its revenue growth rate, it's forecast to grow slower 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 plus side, there were no major changes to revenue estimates; although analyst forecasts imply revenues will perform worse than the wider market. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple BrightView Holdings analysts - going out to 2024, and you can see them free on our platform here.
It might also be worth considering whether BrightView Holdings's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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