It's been a sad week for Kronos Worldwide, Inc. (NYSE:KRO), who've watched their investment drop 14% to US$7.70 in the week since the company reported its full-year result. It was an okay report, and revenues came in at US$1.7b, approximately in line with analyst estimates leading up to the results announcement. 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 analysts have changed their earnings models, following these results.
Taking into account the latest results, the current consensus, from the dual analysts covering Kronos Worldwide, is for revenues of US$1.70b in 2020, which would reflect a noticeable 2.1% reduction in Kronos Worldwide's sales over the past 12 months. Before this earnings result, analysts had predicted US$1.80b revenue in 2020, although there was no accompanying EPS estimate. It looks like analysts have become a bit less bullish on Kronos Worldwide, given the revenue estimates after the latest results.
The average analyst price target fell 9.1% to US$12.50, with analysts clearly having become less optimistic about Kronos Worldwide's prospects following its latest earnings.
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. These estimates imply that sales are expected to slow, with a forecast revenue decline of 2.1% a significant reduction from annual growth of 4.4% over the last five years. Compare this with our data, which suggests that other companies in the same market are, in aggregate, expected to see their revenue grow 3.7% next year. It's pretty clear that Kronos Worldwide's revenues are expected to perform substantially worse than the wider 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. Unfortunately, analysts also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider market. Even so, earnings per share are more important to the intrinsic value of the business. Analysts also downgraded their price target, suggesting that the latest news has led analysts to become more pessimistic about the intrinsic value of the business.
We have estimates for Kronos Worldwide from its dual analysts , and you can see them free on our platform here.
You can also see whether Kronos Worldwide is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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