Perenti Limited Just Missed Earnings - But Analysts Have Updated Their Models

Perenti Limited (ASX:PRN) came out with its yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Statutory earnings per share fell badly short of expectations, coming in at AU$0.10, some 41% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at AU$3.3b. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Perenti

After the latest results, the seven analysts covering Perenti are now predicting revenues of AU$3.49b in 2025. If met, this would reflect a credible 4.3% improvement in revenue compared to the last 12 months. Per-share earnings are expected to jump 66% to AU$0.17. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$3.56b and earnings per share (EPS) of AU$0.19 in 2025. 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 fell 6.0% to AU$1.36, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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. There are some variant perceptions on Perenti, with the most bullish analyst valuing it at AU$1.88 and the most bearish at AU$1.10 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Perenti's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 4.3% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 1.8% per year. Even after the forecast slowdown in growth, it seems obvious that Perenti is also expected 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 Perenti. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Perenti's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Perenti 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 2 warning signs for Perenti 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.