Yahoo Finance News Flash: Analysts Just Made A Meaningful Upgrade To Their Steadfast Group Limited (ASX:SDF) Forecasts
Celebrations may be in order for Steadfast Group Limited (ASX:SDF) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.
Following the upgrade, the latest consensus from Steadfast Group's nine analysts is for revenues of AU$1.4b in 2023, which would reflect a notable 17% improvement in sales compared to the last 12 months. Per-share earnings are expected to step up 10% to AU$0.19. Before this latest update, the analysts had been forecasting revenues of AU$1.2b and earnings per share (EPS) of AU$0.19 in 2023. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.
See our latest analysis for Steadfast Group
Even though revenue forecasts increased, there was no change to the consensus price target of AU$5.69, suggesting the analysts are focused on earnings as the driver of value creation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Steadfast Group analyst has a price target of AU$7.00 per share, while the most pessimistic values it at AU$5.30. With such a narrow range of valuations, analysts apparently share similar views on what they think the business is worth.
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. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 17% growth on an annualised basis. That is in line with its 16% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 2.7% per year. So although Steadfast Group is expected to maintain its revenue growth rate, it's definitely expected to grow faster 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 analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Steadfast Group.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Steadfast Group analysts - going out to 2025, and you can see them free on our platform here.
Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
