Last week saw the newest first-quarter earnings release from Pilgrim's Pride Corporation (NASDAQ:PPC), an important milestone in the company's journey to build a stronger business. Revenues were US$4.4b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.73 were also better than expected, beating analyst predictions by 11%. 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.
Taking into account the latest results, the consensus forecast from Pilgrim's Pride's five analysts is for revenues of US$18.1b in 2024. This reflects a credible 3.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 66% to US$3.44. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$18.0b and earnings per share (EPS) of US$2.94 in 2024. Although the revenue estimates have not really changed, we can see there's been a nice increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
There's been no major changes to the consensus price target of US$37.40, 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. Currently, the most bullish analyst values Pilgrim's Pride at US$42.00 per share, while the most bearish prices it at US$31.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Pilgrim's Pride's revenue growth is expected to slow, with the forecast 4.3% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.8% annually. So it's pretty clear that, while Pilgrim's Pride's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
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 Pilgrim's Pride 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 US$37.40, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Pilgrim's Pride going out to 2026, and you can see them free on our platform here..
Even so, be aware that Pilgrim's Pride is showing 2 warning signs in our investment analysis , 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.