Yahoo Finance Results: LSB Industries, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
A week ago, LSB Industries, Inc. (NYSE:LXU) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of US$138m, some 9.0% above estimates, and statutory earnings per share (EPS) coming in at US$0.08, 84% 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on LSB Industries after the latest results.
See our latest analysis for LSB Industries
Taking into account the latest results, LSB Industries' seven analysts currently expect revenues in 2024 to be US$550.0m, approximately in line with the last 12 months. Statutory earnings per share are forecast to reduce 9.6% to US$0.22 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$514.7m and earnings per share (EPS) of US$0.22 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a modest lift to to revenue forecasts.
It may not be a surprise to see thatthe analysts have reconfirmed their price target of US$9.66, implying that the uplift in revenue is not expected to greatly contribute to LSB Industries's valuation in the near term. 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. The most optimistic LSB Industries analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$8.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 0.2% annualised decline to the end of 2024. That is a notable change from historical 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 4.8% per year. It's pretty clear that LSB Industries' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
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 LSB Industries going out to 2026, and you can see them free on our platform here..
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with LSB Industries (at least 1 which doesn't sit too well with us) , and understanding these should be part of your investment process.
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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.
