The Vita Coco Company, Inc. Just Recorded A 100% EPS Beat: Here's What Analysts Are Forecasting Next
As you might know, The Vita Coco Company, Inc. (NASDAQ:COCO) just kicked off its latest quarterly results with some very strong numbers. The company beat both earnings and revenue forecasts, with revenue of US$110m, some 5.4% above estimates, and statutory earnings per share (EPS) coming in at US$0.12, 100% ahead of expectations. 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.
Check out our latest analysis for Vita Coco Company
After the latest results, the six analysts covering Vita Coco Company are now predicting revenues of US$478.1m in 2023. If met, this would reflect a meaningful 8.4% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 219% to US$0.70. In the lead-up to this report, the analysts had been modelling revenues of US$473.2m and earnings per share (EPS) of US$0.62 in 2023. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the nice gain to earnings per share expectations following these results.
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 19% to US$26.33. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Vita Coco Company analyst has a price target of US$30.00 per share, while the most pessimistic values it at US$25.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Vita Coco Company is an easy business to forecast or the the analysts are all using similar assumptions.
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. We can infer from the latest estimates that forecasts expect a continuation of Vita Coco Company'shistorical trends, as the 11% annualised revenue growth to the end of 2023 is roughly in line with the 10% annual revenue growth over the past year. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 5.3% annually. So although Vita Coco Company is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Vita Coco Company's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that in mind, we wouldn't be too quick to come to a conclusion on Vita Coco Company. Long-term earnings power is much more important than next year's profits. We have forecasts for Vita Coco Company going out to 2025, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Vita Coco Company that you should be aware of.
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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.
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