Yahoo Finance McBride plc (LON:MCB) Just Reported Earnings, And Analysts Cut Their Target Price
As you might know, McBride plc (LON:MCB) recently reported its annual numbers. The results overall were pretty much dead in line with analyst forecasts; revenues were UK£678m and statutory losses were UK£0.14 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Check out our latest analysis for McBride
Taking into account the latest results, the consensus forecast from McBride's dual analysts is for revenues of UK£831.9m in 2023, which would reflect a major 23% improvement in sales compared to the last 12 months. Losses are supposed to decline, shrinking 11% from last year to UK£0.12. Yet prior to the latest earnings, the analysts had been forecasting revenues of UK£829.1m and losses of UK£0.044 per share in 2023. While this year's revenue estimates held steady, there was also a very substantial increase in loss per share expectations, suggesting the consensus has a bit of a mixed view on the stock.
With the increase in forecast losses for next year, it's perhaps no surprise to see that the average price target dipped 46% to UK£0.35, with the analysts signalling that growing losses would be a definite concern.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the McBride's past performance and to peers in the same industry. The analysts are definitely expecting McBride's growth to accelerate, with the forecast 23% annualised growth to the end of 2023 ranking favourably alongside historical growth of 0.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.0% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that McBride is expected to grow much faster than its industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at McBride. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 3 warning signs for McBride (of which 1 is significant!) you should know about.
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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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