Yahoo Finance Premier, Inc. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now
It's been a good week for Premier, Inc. (NASDAQ:PINC) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.4% to US$37.52. Results overall were not great, with earnings of US$0.32 per share falling drastically short of analyst expectations. Meanwhile revenues hit US$348m and were slightly better than forecasts. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Premier
Taking into account the latest results, the ten analysts covering Premier provided consensus estimates of US$1.42b revenue in 2023, which would reflect a chunky 9.6% decline on its sales over the past 12 months. Statutory earnings per share are forecast to decline 14% to US$2.07 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.43b and earnings per share (EPS) of US$2.11 in 2023. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$41.27. 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 Premier analyst has a price target of US$46.00 per share, while the most pessimistic values it at US$35.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 7.7% annualised revenue decline to the end of 2023. That is a notable change from historical growth of 5.5% 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 7.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Premier is expected to lag 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. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse 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 in mind, we wouldn't be too quick to come to a conclusion on Premier. Long-term earnings power is much more important than next year's profits. We have forecasts for Premier going out to 2024, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Premier (1 doesn't sit too well with us!) that you need to take into consideration.
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.
