Stella-Jones Inc. (TSE:SJ) Full-Year Results: Here's What Analysts Are Forecasting For This Year
Stella-Jones Inc. (TSE:SJ) shareholders are probably feeling a little disappointed, since its shares fell 7.5% to CA$72.82 in the week after its latest yearly results. Results were roughly in line with estimates, with revenues of CA$3.3b and statutory earnings per share of CA$5.62. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
View our latest analysis for Stella-Jones
After the latest results, the seven analysts covering Stella-Jones are now predicting revenues of CA$3.61b in 2024. If met, this would reflect a decent 8.7% improvement in revenue compared to the last 12 months. Statutory per-share earnings are expected to be CA$5.68, roughly flat on the last 12 months. Before this earnings report, the analysts had been forecasting revenues of CA$3.69b and earnings per share (EPS) of CA$5.78 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.
The consensus has reconfirmed its price target of CA$90.71, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Stella-Jones' market value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Stella-Jones analyst has a price target of CA$95.00 per share, while the most pessimistic values it at CA$85.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Stella-Jones is an easy business to forecast or the the analysts are all using similar assumptions.
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. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 8.7% growth on an annualised basis. That is in line with its 9.5% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 5.8% annually. So although Stella-Jones is expected to maintain its revenue growth rate, it's definitely expected to grow faster than 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 analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. Still, earnings per share are more important to value creation for shareholders. The consensus price target held steady at CA$90.71, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Stella-Jones analysts - going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for Stella-Jones (of which 1 is a bit concerning!) you should know about.
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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.
