Yahoo Finance Results: Cargojet Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts
Investors in Cargojet Inc. (TSE:CJT) had a good week, as its shares rose 2.4% to close at CA$117 following the release of its first-quarter results. It looks like a credible result overall - although revenues of CA$231m were what the analysts expected, Cargojet surprised by delivering a (statutory) profit of CA$1.84 per share, an impressive 182% above what was forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Cargojet after the latest results.
View our latest analysis for Cargojet
Taking into account the latest results, the most recent consensus for Cargojet from twelve analysts is for revenues of CA$947.4m in 2024. If met, it would imply a decent 8.1% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 164% to CA$6.21. Before this earnings report, the analysts had been forecasting revenues of CA$961.5m and earnings per share (EPS) of CA$4.36 in 2024. Although the revenue estimates have not really changed, we can see there's been a massive increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target was unchanged at CA$150, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Cargojet analyst has a price target of CA$182 per share, while the most pessimistic values it at CA$115. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
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. It's pretty clear that there is an expectation that Cargojet's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 11% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.1% annually. Even after the forecast slowdown in growth, it seems obvious that Cargojet is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Cargojet following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.
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. We have estimates - from multiple Cargojet analysts - going out to 2026, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 2 warning signs for Cargojet (1 is concerning!) that you need to be mindful 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.
