It's been a mediocre week for GCP Applied Technologies Inc. (NYSE:GCP) shareholders, with the stock dropping 11% to US$19.47 in the week since its latest full-year results. It was an okay result overall, with revenues coming in at US$1.0b, roughly what analysts had been expecting. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether analysts have changed their mind on GCP Applied Technologies after the latest results.
Taking into account the latest results, GCP Applied Technologies's twin analysts currently expect revenues in 2020 to be US$1.02b, approximately in line with the last 12 months. In the lead-up to this report, analysts had been modelling revenues of US$1.04b and earnings per share (EPS) of US$0.69 in 2020. So we can see that while the consensus made no real change to its revenue estimates, it also no longer provides an earnings per share estimate, suggesting that revenues are what the market is focusing on after the latest results.
There's been no real change to the consensus price target of US$28.00, with GCP Applied Technologiesseemingly executing in line with expectations.
Further, we can compare these estimates to past performance, and see how GCP Applied Technologies forecasts compare to the wider market's forecast performance. From these estimates it looks as though 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. Compare this against analyst estimates for the wider market, which suggest that (in aggregate) market revenues are expected to grow 3.9% next year. So it's pretty clear that, although revenues are improving, GCP Applied Technologies is still expected to grow slower than the market.
The Bottom Line
The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for GCP Applied Technologies. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that GCP Applied Technologies's revenues are expected to perform worse 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.
At least one of GCP Applied Technologies's twin analysts has provided estimates out to 2023, which can be seen for free on our platform here.
You can also view our analysis of GCP Applied Technologies's balance sheet, and whether we think GCP Applied Technologies is carrying too much debt, for free on our platform here.
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