It's been a sad week for Plantronics, Inc. (NYSE:PLT), who've watched their investment drop 11% to US$12.53 in the week since the company reported its yearly result. It was a pretty bad result overall; while revenues were in line with expectations at US$1.7b, statutory losses exploded to US$20.48 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
After the latest results, the consensus from Plantronics' six analysts is for revenues of US$1.55b in 2021, which would reflect a definite 8.6% decline in sales compared to the last year of performance. Losses are predicted to fall substantially, shrinking 84% to US$3.34. Before this earnings announcement, the analysts had been modelling revenues of US$1.56b and losses of US$3.18 per share in 2021. So it's pretty clear consensus is mixed on Plantronics after the new consensus numbers; while the analysts held their revenue numbers steady, they also administered a per-share loss expectations.
With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 6.9% to US$15.83, with the analysts signalling that growing losses would be a definite concern. 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 Plantronics, with the most bullish analyst valuing it at US$22.00 and the most bearish at US$10.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Plantronics' past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with the forecast 8.6% revenue decline a notable change from historical growth of 19% 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 3.4% next year. It's pretty clear that Plantronics' 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 increased 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 Plantronics' revenues are expected to perform worse than 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Plantronics going out to 2023, 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 2 warning signs for Plantronics (1 shouldn't be ignored!) that you need to be mindful of.
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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. Thank you for reading.