Last week, you might have seen that CSW Industrials, Inc. (NASDAQ:CSWI) released its quarterly result to the market. The early response was not positive, with shares down 2.4% to US$74.09 in the past week. Results overall were respectable, with statutory earnings of US$0.48 per share roughly in line with what analysts had forecast. Revenues of US$84m came in 2.3% ahead of analyst predictions. Analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether analysts have changed their earnings models, following these results.
Following the latest results, CSW Industrials's dual analysts are now forecasting revenues of US$403.2m in 2021. This would be a credible 6.4% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to swell 15% to US$3.45. In the lead-up to this report, analysts had been modelling revenues of US$399.4m and earnings per share (EPS) of US$3.40 in 2021. So it's pretty clear that, although analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
The consensus price target rose 5.8% to US$73.50 despite there being no meaningful change to earnings estimates. It could be that analysts are reflecting the predictability of CSW Industrials's earnings by assigning a price premium.
In addition, we can look to CSW Industrials's past performance and see whether business is expected to improve, and if the company is expected to perform better than wider market. Next year brings more of the same, according to analysts, with revenue forecast to grow 6.4%, in line with its 6.5% annual growth over the past five years. Compare this with the wider market, which analyst estimates (in aggregate) suggest will see revenues grow 4.3% next year. So it's pretty clear that CSW Industrials is forecast to grow substantially faster than its market.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that CSW Industrials's revenues are expected to grow faster than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
Still, the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2021, which can be seen for free on our platform here.
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