As you might know, RediShred Capital Corp. (CVE:KUT) last week released its latest third-quarter, and things did not turn out so great for shareholders. Results showed a clear earnings miss, with CA$5.4m revenue coming in 7.1% lower than what analysts expected. Earnings per share (EPS) of CA$0.002 missed the mark badly, arriving some 80% below what analysts had expected. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings consensus estimates to see what could be in store for next year.
Following the latest results, RediShred Capital's three analysts are now forecasting revenues of CA$27.7m in 2020. This would be a major 36% improvement in sales compared to the last 12 months. Prior to the latest earnings, analysts were forecasting revenues of CA$28.6m in 2020, and did not provide an EPS estimate. The consensus seems a bit less optimistic overall, with the revenue forecasts following the latest results.
We'd also point out that that analysts have made no major changes to their price target of CA$1.32. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic RediShred Capital analyst has a price target of CA$1.50 per share, while the most pessimistic values it at CA$1.15. 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 also be useful to step back and take a broader view of how analyst forecasts compare to RediShred Capital's performance in recent years. Analysts are definitely expecting RediShred Capital's growth to accelerate, with the forecast 36% growth ranking favourably alongside historical growth of 23% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.7% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that RediShred Capital is expected to grow much faster than its market.
The Bottom Line
The most important thing to take away from these updates is that analysts are definitely optimistic on the business, given that they've begun forecasting positive per-share earnings for next year. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will 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.
We have estimates for RediShred Capital from its three analysts , and you can see them free on our platform here.
We also provide an overview of the RediShred Capital Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.
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