First Industrial Realty Trust, Inc. (NYSE:FR) came out with its quarterly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Revenues were US$110m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.32, an impressive 58% ahead of estimates. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, First Industrial Realty Trust's four analysts currently expect revenues in 2020 to be US$439.3m, approximately in line with the last 12 months. Statutory earnings per share are forecast to tumble 58% to US$0.84 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$439.3m and earnings per share (EPS) of US$0.86 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.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$40.22. 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. The most optimistic First Industrial Realty Trust analyst has a price target of US$47.00 per share, while the most pessimistic values it at US$32.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that First Industrial Realty Trust's revenue growth will slow down substantially, with revenues next year expected to grow 1.6%, compared to a historical growth rate of 3.8% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that First Industrial Realty Trust is also expected to grow slower than other industry participants.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that First Industrial Realty Trust's revenues are expected to 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. We have estimates - from multiple First Industrial Realty Trust analysts - going out to 2024, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 5 warning signs for First Industrial Realty Trust (2 are potentially serious) you should be aware of.
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