Westgold Resources Limited Just Missed Earnings - But Analysts Have Updated Their Models

It's been a good week for Westgold Resources Limited (ASX:WGX) shareholders, because the company has just released its latest annual results, and the shares gained 5.6% to AU$3.41. Statutory earnings per share fell badly short of expectations, coming in at AU$0.038, some 69% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at AU$1.4b. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the most recent consensus for Westgold Resources from five analysts is for revenues of AU$1.93b in 2026. If met, it would imply a sizeable 42% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 1,090% to AU$0.44. Before this earnings report, the analysts had been forecasting revenues of AU$1.89b and earnings per share (EPS) of AU$0.52 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.

Check out our latest analysis for Westgold Resources

The consensus price target held steady at AU$4.04, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on Westgold Resources, with the most bullish analyst valuing it at AU$5.07 and the most bearish at AU$3.49 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Westgold Resources' past performance and to peers in the same industry. It's clear from the latest estimates that Westgold Resources' rate of growth is expected to accelerate meaningfully, with the forecast 42% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 16% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.3% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Westgold Resources is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Westgold Resources going out to 2028, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Westgold Resources that you should be aware 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.