- Oops!Something went wrong.Please try again later.
Cal-Maine Foods, Inc. (NASDAQ:CALM) just released its quarterly report and things are looking bullish. Revenues and losses per share were both better than expected, with revenues of US$293m leading estimates by 3.7%. Statutory losses were smaller than the analystsexpected, coming in at US$0.40 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, Cal-Maine Foods' two analysts currently expect revenues in 2021 to be US$1.41b, approximately in line with the last 12 months. Statutory earnings per share are predicted to leap 21% to US$1.12. Before this earnings report, the analysts had been forecasting revenues of US$1.41b and earnings per share (EPS) of US$1.21 in 2021. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$44.00, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Cal-Maine Foods' past performance and to peers in the same industry. From these estimates it looks as though the analysts expect the years of declining sales to come to an end, given the flat revenue forecast for next year. That would be a definite improvement, given that the past five years have seen sales shrink five years annually. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 2.9% per year. Although Cal-Maine Foods' revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Cal-Maine Foods. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Cal-Maine Foods' revenues are expected to perform worse than the wider industry. The consensus price target held steady at US$44.00, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Cal-Maine Foods. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Cal-Maine Foods going out as far as 2023, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Cal-Maine Foods you should know about.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email firstname.lastname@example.org.