The Americana Restaurants International PLC (ADX:AMR) Second-Quarter Results Are Out And Analysts Have Published New Forecasts

Last week saw the newest second-quarter earnings release from Americana Restaurants International PLC (ADX:AMR), an important milestone in the company's journey to build a stronger business. It was an okay result overall, with revenues coming in at US$559m, roughly what the analysts had been expecting. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Americana Restaurants International

After the latest results, the ten analysts covering Americana Restaurants International are now predicting revenues of US$2.39b in 2024. If met, this would reflect a satisfactory 7.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 6.1% to US$0.025. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.37b and earnings per share (EPS) of US$0.027 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at د.إ3.49, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Americana Restaurants International analyst has a price target of د.إ4.11 per share, while the most pessimistic values it at د.إ2.89. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Americana Restaurants International's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Americana Restaurants International is forecast to grow faster in the future than it has in the past, with revenues expected to display 16% annualised growth until the end of 2024. If achieved, this would be a much better result than the 9.9% annual decline over the past year. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 11% annually. Not only are Americana Restaurants International's revenues expected to improve, it seems that the analysts are also expecting it to grow faster 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 Americana Restaurants International. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Americana Restaurants International analysts - going out to 2026, and you can see them free on our platform here.

You can also see our analysis of Americana Restaurants International's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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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