Yahoo Finance FGI Industries Ltd. Beat Revenue Forecasts By 6.2%: Here's What Analysts Are Forecasting Next
It's been a pretty great week for FGI Industries Ltd. (NASDAQ:FGI) shareholders, with its shares surging 13% to US$2.76 in the week since its latest second-quarter results. It was a workmanlike result, with revenues of US$48m coming in 6.2% ahead of expectations, and statutory earnings per share of US$0.10, in line with analyst appraisals. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on FGI Industries after the latest results.
Check out our latest analysis for FGI Industries
After the latest results, the consensus from FGI Industries' twin analysts is for revenues of US$185.3m in 2022, which would reflect a perceptible 4.7% decline in sales compared to the last year of performance. Statutory earnings per share are forecast to dip 3.6% to US$0.42 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$184.1m and earnings per share (EPS) of US$0.38 in 2022. Although the revenue estimates have not really changed, we can see there's been a solid gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target fell 23% to US$6.00, suggesting the increase in earnings forecasts was not enough to offset other the analysts concerns.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that sales are expected to reverse, with a forecast 9.2% annualised revenue decline to the end of 2022. That is a notable change from historical growth of 29% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.7% per year. It's pretty clear that FGI Industries' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards FGI Industries following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that in mind, we wouldn't be too quick to come to a conclusion on FGI Industries. Long-term earnings power is much more important than next year's profits. We have analyst estimates for FGI Industries going out as far as 2023, and you can see them free on our platform here.
It is also worth noting that we have found 4 warning signs for FGI Industries (2 are concerning!) 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.
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