Yahoo Finance Cannae Holdings, Inc. Just Missed Earnings With A Surprise Loss - Here Are Analysts Latest Forecasts
It's been a good week for Cannae Holdings, Inc. (NYSE:CNNE) shareholders, because the company has just released its latest quarterly results, and the shares gained 5.2% to US$23.29. It was a pretty bad result overall, with revenues coming in 23% lower than the analysts predicted. Statutory earnings correspondingly nosedived, with Cannae Holdings reporting a loss of US$3.15 per share, where the analysts were expecting a profit. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Cannae Holdings after the latest results.
View our latest analysis for Cannae Holdings
Taking into account the latest results, the consensus forecast from Cannae Holdings' three analysts is for revenues of US$744.0m in 2022, which would reflect a reasonable 4.8% improvement in sales compared to the last 12 months. Losses are predicted to fall substantially, shrinking 37% to US$5.86. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$842.5m and losses of US$2.48 per share in 2022. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.
There was no major change to the consensus price target of US$38.67, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. 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. The most optimistic Cannae Holdings analyst has a price target of US$42.00 per share, while the most pessimistic values it at US$35.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Cannae Holdings is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Cannae Holdings' past performance and to peers in the same industry. One thing stands out from these estimates, which is that Cannae Holdings is forecast to grow faster in the future than it has in the past, with revenues expected to display 9.9% annualised growth until the end of 2022. If achieved, this would be a much better result than the 13% annual decline over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 8.9% annually. So while Cannae Holdings' revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.
The Bottom Line
The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Cannae Holdings. Sadly, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. The consensus price target held steady at US$38.67, 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 Cannae Holdings going out to 2023, and you can see them free on our platform here..
You can also view our analysis of Cannae Holdings' balance sheet, and whether we think Cannae Holdings is carrying too much debt, for free on our platform here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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