BlueScope Steel Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

The analysts might have been a bit too bullish on BlueScope Steel Limited (ASX:BSL), given that the company fell short of expectations when it released its full-year results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at AU$17b, statutory earnings missed forecasts by 12%, coming in at just AU$1.80 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for BlueScope Steel

Taking into account the latest results, the current consensus, from the 14 analysts covering BlueScope Steel, is for revenues of AU$16.1b in 2025. This implies a small 5.7% reduction in BlueScope Steel's revenue over the past 12 months. Statutory earnings per share are expected to dive 33% to AU$1.23 in the same period. Before this earnings report, the analysts had been forecasting revenues of AU$17.0b and earnings per share (EPS) of AU$1.72 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

The analysts made no major changes to their price target of AU$21.95, suggesting the downgrades are not expected to have a long-term impact on BlueScope Steel's 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 BlueScope Steel analyst has a price target of AU$25.57 per share, while the most pessimistic values it at AU$17.00. 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.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 5.7% annualised decline to the end of 2025. That is a notable change from historical growth of 11% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 1.8% annually for the foreseeable future. It's pretty clear that BlueScope Steel's revenues are expected to perform substantially worse 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 BlueScope Steel. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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 BlueScope Steel analysts - going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for BlueScope Steel that you need to be mindful of.

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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.