Tupperware Brands Corporation (NYSE:TUP) just released its quarterly report and things are looking bullish. Statutory revenue and earnings both blasted past expectations, with revenue of US$477m beating expectations by 31% and earnings per share (EPS) reaching US$0.65, some 81% ahead of expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Tupperware Brands' three analysts is for revenues of US$1.77b in 2021, which would reflect an okay 5.9% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to soar 708% to US$3.08. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.66b and earnings per share (EPS) of US$2.39 in 2021. So it seems there's been a definite increase in optimism about Tupperware Brands' future following the latest results, with a considerable lift to the earnings per share forecasts in particular.
It will come as no surprise to learn that the analysts have increased their price target for Tupperware Brands 37% to US$38.33on the back of these upgrades. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Tupperware Brands, with the most bullish analyst valuing it at US$46.00 and the most bearish at US$31.00 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. For example, we noticed that Tupperware Brands' rate of growth is expected to accelerate meaningfully, with revenues forecast to grow 5.9%, well above its historical decline of 6.3% a year 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 9.4% per year. So although Tupperware Brands' revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Tupperware Brands' earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates sales are expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts 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 Tupperware Brands. Long-term earnings power is much more important than next year's profits. We have forecasts for Tupperware Brands going out to 2022, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 4 warning signs for Tupperware Brands that you need to be mindful of.
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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