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Earnings Miss: Americold Realty Trust Missed EPS By 20% And Analysts Are Revising Their Forecasts

Simply Wall St

Last week, you might have seen that Americold Realty Trust (NYSE:COLD) released its yearly result to the market. The early response was not positive, with shares down 8.5% to US$34.81 in the past week. Revenues were in line with forecasts, at US$1.8b, although statutory earnings per share came in 20% below what analysts expected, at US$0.26 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Americold Realty Trust

NYSE:COLD Past and Future Earnings, February 24th 2020

Following the latest results, Americold Realty Trust's five analysts are now forecasting revenues of US$1.99b in 2020. This would be a meaningful 12% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to jump 113% to US$0.57. Before this earnings report, analysts had been forecasting revenues of US$1.99b and earnings per share (EPS) of US$0.56 in 2020. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

Analysts reconfirmed their price target of US$39.94, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Americold Realty Trust at US$42.50 per share, while the most bearish prices it at US$38.00. 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.

It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Americold Realty Trust's past performance and to peers in the same market. Analysts are definitely expecting Americold Realty Trust's growth to accelerate, with the forecast 12% growth ranking favourably alongside historical growth of 3.3% per annum over the past five years. Compare this with other companies in the same market, which are forecast to grow their revenue 4.9% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Americold Realty Trust is expected to grow much 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 Americold Realty Trust's revenues are expected to grow faster 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 forecasts for Americold Realty Trust going out to 2024, and you can see them free on our platform here.

It might also be worth considering whether Americold Realty Trust's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.