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Hawkins, Inc. (NASDAQ:HWKN) just released its third-quarter report and things are looking bullish. The company beat both earnings and revenue forecasts, with revenue of US$143m, some 5.2% above estimates, and statutory earnings per share (EPS) coming in at US$0.75, 21% ahead of expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is 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 analyst has changed their mind on Hawkins after the latest results.
Taking into account the latest results, the current consensus from Hawkins' solitary analyst is for revenues of US$593.5m in 2022, which would reflect an okay 4.8% increase on its sales over the past 12 months. Statutory earnings per share are predicted to rise 2.1% to US$3.55. Before this earnings report, the analyst had been forecasting revenues of US$593.5m and earnings per share (EPS) of US$3.55 in 2022. The consensus analyst doesn'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.
The consensus price target rose 8.1% to US$67.00despite there being no meaningful change to earnings estimates. It could be that the analystare reflecting the predictability of Hawkins' earnings by assigning a price premium.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hawkins' past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Hawkins'historical trends, as next year's 4.8% revenue growth is roughly in line with 5.6% annual revenue growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 5.5% per year. So although Hawkins is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analyst reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Hawkins. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Hawkins going out as far as 2022, and you can see them free on our platform here.
You can also see whether Hawkins is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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. 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.
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