As you might know, Alpha Metallurgical Resources, Inc. (NYSE:AMR) just kicked off its latest annual results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 4.9% to hit US$3.5b. Statutory earnings per share (EPS) came in at US$49.30, some 8.8% above whatthe analysts had expected. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the current consensus, from the two analysts covering Alpha Metallurgical Resources, is for revenues of US$3.21b in 2024. This implies a small 7.5% reduction in Alpha Metallurgical Resources' revenue over the past 12 months. Statutory earnings per share are expected to dive 38% to US$34.51 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$2.99b and earnings per share (EPS) of US$31.60 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
It will come as no surprise to learn that the analysts have increased their price target for Alpha Metallurgical Resources 85% to US$406on the back of these upgrades.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 7.5% by the end of 2024. This indicates a significant reduction from annual growth of 18% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.8% annually for the foreseeable future. It's pretty clear that Alpha Metallurgical Resources' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Alpha Metallurgical Resources' earnings potential next year. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for Alpha Metallurgical Resources going out as far as 2026, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Alpha Metallurgical Resources (at least 1 which makes us a bit uncomfortable) , and understanding these should be part of your investment process.
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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.