Results: Compass Minerals International, Inc. Delivered A Surprise Loss And Now Analysts Have New Forecasts
It's been a sad week for Compass Minerals International, Inc. (NYSE:CMP), who've watched their investment drop 10% to US$20.70 in the week since the company reported its quarterly result. Revenues fell 4.2% short of expectations, at US$342m. Earnings correspondingly dipped, with Compass Minerals International reporting a statutory loss of US$1.83 per share, whereas the analysts had previously modelled a profit in this period. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Check out our latest analysis for Compass Minerals International
Taking into account the latest results, the current consensus from Compass Minerals International's eight analysts is for revenues of US$1.24b in 2024. This would reflect a credible 3.6% increase on its revenue over the past 12 months. Per-share statutory losses are expected to explode, reaching US$1.05 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.27b and earnings per share (EPS) of US$0.77 in 2024. There looks to have been a significant drop in sentiment regarding Compass Minerals International's prospects after these latest results, with a small dip in revenues and the analysts now forecasting a loss instead of a profit.
The consensus price target fell 12% to US$30.00, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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. Currently, the most bullish analyst values Compass Minerals International at US$48.00 per share, while the most bearish prices it at US$21.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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. One thing stands out from these estimates, which is that Compass Minerals International is forecast to grow faster in the future than it has in the past, with revenues expected to display 4.8% annualised growth until the end of 2024. If achieved, this would be a much better result than the 3.9% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 4.8% per year. So while Compass Minerals International's revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.
The Bottom Line
The most important thing to take away is that the analysts are expecting Compass Minerals International to become unprofitable next year. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 Simply Wall St, we have a full range of analyst estimates for Compass Minerals International going out to 2026, and you can see them free on our platform here..
Plus, you should also learn about the 2 warning signs we've spotted with Compass Minerals International .
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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.
