Yahoo Finance Analysts Have Lowered Expectations For Charles River Laboratories International, Inc. (NYSE:CRL) After Its Latest Results
It's been a mediocre week for Charles River Laboratories International, Inc. (NYSE:CRL) shareholders, with the stock dropping 14% to US$201 in the week since its latest quarterly results. Charles River Laboratories International reported US$1.0b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.74 beat expectations, being 3.9% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Charles River Laboratories International
Taking into account the latest results, the current consensus, from the 16 analysts covering Charles River Laboratories International, is for revenues of US$4.00b in 2024. This implies a small 2.0% reduction in Charles River Laboratories International's revenue over the past 12 months. Statutory earnings per share are expected to plummet 27% to US$6.12 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$4.22b and earnings per share (EPS) of US$7.88 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.
It'll come as no surprise then, to learn that the analysts have cut their price target 10% to US$227. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Charles River Laboratories International, with the most bullish analyst valuing it at US$260 and the most bearish at US$191 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Charles River Laboratories International's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.0% by the end of 2024. This indicates a significant reduction from annual growth of 11% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.7% per year. It's pretty clear that Charles River Laboratories International's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Charles River Laboratories International. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Charles River Laboratories International's future valuation.
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 Charles River Laboratories International analysts - going out to 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 1 warning sign for Charles River Laboratories International that you should be aware 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.
