Spin Master Corp. (TSE:TOY) Just Released Its First-Quarter Results And Analysts Are Updating Their Estimates

Shareholders might have noticed that Spin Master Corp. (TSE:TOY) filed its first-quarter result this time last week. The early response was not positive, with shares down 5.6% to CA$29.01 in the past week. The results were positive, with revenue coming in at US$316m, beating analyst expectations by 6.3%. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Spin Master

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Taking into account the latest results, the consensus forecast from Spin Master's eight analysts is for revenues of US$2.28b in 2024. This reflects a solid 17% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 156% to US$2.43. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.28b and earnings per share (EPS) of US$2.16 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the nice increase in earnings per share expectations following these results.

There's been no major changes to the consensus price target of CA$43.45, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. There are some variant perceptions on Spin Master, with the most bullish analyst valuing it at CA$49.92 and the most bearish at CA$34.88 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Spin Master's rate of growth is expected to accelerate meaningfully, with the forecast 23% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.0% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 2.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Spin Master 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 Spin Master following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at CA$43.45, with the latest estimates not enough to have an impact on their price targets.

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 Spin Master 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 3 warning signs for Spin Master 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.