Yahoo Finance NZME Limited (NZSE:NZM) Analysts Are Pretty Bullish On The Stock After Recent Results
NZME Limited (NZSE:NZM) shareholders are probably feeling a little disappointed, since its shares fell 6.7% to NZ$0.83 in the week after its latest annual results. The result was fairly weak overall, with revenues of NZ$322m being 3.6% less than what the analyst had been modelling. The analyst 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analyst has changed their mind on NZME after the latest results.
Check out our latest analysis for NZME
Taking into account the latest results, the current consensus from NZME's solitary analyst is for revenues of NZ$346.5m in 2021, which would reflect a modest 7.6% increase on its sales over the past 12 months. Per-share earnings are expected to jump 31% to NZ$0.097. In the lead-up to this report, the analyst had been modelling revenues of NZ$346.6m and earnings per share (EPS) of NZ$0.098 in 2021. So it's pretty clear that, although the analyst has updated their estimates, there's been no major change in expectations for the business following the latest results.
The consensus price target rose 24% to NZ$0.99despite there being no meaningful change to earnings estimates. It could be that the analystare reflecting the predictability of NZME's earnings by assigning a price premium.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the NZME's past performance and to peers in the same industry. One thing stands out from these estimates, which is that NZME is forecast to grow faster in the future than it has in the past, with revenues expected to grow 7.6%. If achieved, this would be a much better result than the 4.5% annual decline over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 4.0% per year. Not only are NZME's revenues expected to improve, it seems that the analyst is also expecting it to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analyst holding their earnings forecasts steady, in line with previous estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for NZME going out as far as 2023, and you can see them free on our platform here.
You can also view our analysis of NZME's balance sheet, and whether we think NZME is carrying too much debt, for free on our platform here.
This article by Simply Wall St is general in nature. 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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