Last week, you might have seen that U.S. Silica Holdings, Inc. (NYSE:SLCA) released its quarterly result to the market. The early response was not positive, with shares down 3.9% to US$2.72 in the past week. It looks like the results were pretty good overall. While revenues of US$176m were in line with analyst predictions, statutory losses were much smaller than expected, with U.S. Silica Holdings losing US$0.19 per share. 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.
Following the recent earnings report, the consensus from six analysts covering U.S. Silica Holdings is for revenues of US$855.8m in 2021, implying an uneasy 11% decline in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 81% to US$1.10. Before this earnings announcement, the analysts had been modelling revenues of US$865.2m and losses of US$1.51 per share in 2021. While the revenue estimates were largely unchanged, sentiment seems to have improved, with the analysts upgrading revenues and making a losses per share in particular.
The average price target rose 7.7% to US$3.54, with the analysts signalling that the forecast reduction in losses would be a positive for the stock's valuation. 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 U.S. Silica Holdings, with the most bullish analyst valuing it at US$4.35 and the most bearish at US$2.50 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.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that sales are expected to slow, with a forecast revenue decline of 11%, a significant reduction from annual growth of 18% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.2% next year. It's pretty clear that U.S. Silica Holdings' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that U.S. Silica Holdings' revenues 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for U.S. Silica Holdings going out to 2024, and you can see them free on our platform here.
Even so, be aware that U.S. Silica Holdings is showing 2 warning signs in our investment analysis , you should know about...
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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