Earnings Update: Stoneridge, Inc. (NYSE:SRI) Just Reported Its Annual Results And Analysts Are Updating Their Forecasts
Shareholders might have noticed that Stoneridge, Inc. (NYSE:SRI) filed its annual result this time last week. The early response was not positive, with shares down 3.3% to US$17.66 in the past week. Revenue hit US$976m in line with forecasts, although the company reported a statutory loss per share of US$0.19 that was somewhat smaller than the analysts expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Stoneridge after the latest results.
See our latest analysis for Stoneridge
Taking into account the latest results, Stoneridge's twin analysts currently expect revenues in 2024 to be US$992.9m, approximately in line with the last 12 months. Earnings are expected to improve, with Stoneridge forecast to report a statutory profit of US$0.30 per share. In the lead-up to this report, the analysts had been modelling revenues of US$999.5m and earnings per share (EPS) of US$0.45 in 2024. So there's definitely been a decline in sentiment after the latest results, noting the large cut to new EPS forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$25.75, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Stoneridge's revenue growth is expected to slow, with the forecast 1.7% annualised growth rate until the end of 2024 being well below the historical 3.6% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 10% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Stoneridge.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Stoneridge. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. 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.
Following on from that line of thought, we think that 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 2025, which can be seen for free on our platform here.
It is also worth noting that we have found 1 warning sign for Stoneridge that you need to take into consideration.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
