Shareholders might have noticed that Emerald Holding, Inc. (NYSE:EEX) filed its quarterly result this time last week. The early response was not positive, with shares down 4.2% to US$5.70 in the past week. Revenues of US$133m beat analyst forecasts by4.9%, while the business broke even in terms of statutory earnings per share (EPS). Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the consensus forecast from Emerald Holding's three analysts is for revenues of US$422.1m in 2024. This reflects a credible 7.2% improvement in revenue compared to the last 12 months. Losses are forecast to balloon 99% to US$0.46 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$419.7m and losses of US$0.45 per share in 2024. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although revenue forecasts held steady, the consensus also made a pronounced increase to its losses per share forecasts.
As a result, there was no major change to the consensus price target of US$9.43, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Emerald Holding, with the most bullish analyst valuing it at US$11.00 and the most bearish at US$8.20 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Emerald Holding's growth to accelerate, with the forecast 9.7% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Emerald Holding is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$9.43, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Emerald Holding. Long-term earnings power is much more important than next year's profits. We have forecasts for Emerald Holding going out to 2025, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Emerald Holding (1 doesn't sit too well with us!) that you need to take into consideration.
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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.