Yahoo Finance Earnings Miss: Eastman Chemical Company Missed EPS By 14% And Analysts Are Revising Their Forecasts
Last week, you might have seen that Eastman Chemical Company (NYSE:EMN) released its first-quarter result to the market. The early response was not positive, with shares down 3.5% to US$103 in the past week. Statutory earnings per share of US$1.80 unfortunately missed expectations by 14%, although it was encouraging to see revenues of US$2.7b exceed expectations by 8.7%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for Eastman Chemical
Following last week's earnings report, Eastman Chemical's 15 analysts are forecasting 2022 revenues to be US$10.7b, approximately in line with the last 12 months. Statutory earnings per share are predicted to jump 43% to US$9.50. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$10.5b and earnings per share (EPS) of US$9.55 in 2022. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$135, suggesting that the company has met expectations in its recent result. 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. Currently, the most bullish analyst values Eastman Chemical at US$165 per share, while the most bearish prices it at US$114. 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 Eastman Chemical's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Eastman Chemical is forecast to grow faster in the future than it has in the past, with revenues expected to display 2.3% annualised growth until the end of 2022. If achieved, this would be a much better result than the 0.6% 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 5.1% annually for the foreseeable future. So although Eastman Chemical's revenue growth is expected to improve, it is still expected to grow slower than the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Eastman Chemical's revenues are expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Eastman Chemical analysts - going out to 2024, and you can see them free on our platform here.
Even so, be aware that Eastman Chemical is showing 3 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.
