Lifestyle Communities Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Shareholders might have noticed that Lifestyle Communities Limited (ASX:LIC) filed its yearly result this time last week. The early response was not positive, with shares down 2.2% to AU$16.65 in the past week. It looks like a credible result overall - although revenues of AU$232m were what the analysts expected, Lifestyle Communities surprised by delivering a (statutory) profit of AU$0.78 per share, an impressive 29% above what was forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Lifestyle Communities

Taking into account the latest results, the most recent consensus for Lifestyle Communities from six analysts is for revenues of AU$315.4m in 2024. If met, it would imply a sizeable 36% increase on its revenue over the past 12 months. Statutory earnings per share are expected to shrink 3.2% to AU$0.76 in the same period. In the lead-up to this report, the analysts had been modelling revenues of AU$319.7m and earnings per share (EPS) of AU$0.90 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

The consensus price target held steady at AU$18.78, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Lifestyle Communities, with the most bullish analyst valuing it at AU$25.15 and the most bearish at AU$17.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Lifestyle Communities shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Lifestyle Communities' growth to accelerate, with the forecast 36% annualised growth to the end of 2024 ranking favourably alongside historical growth of 14% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 8.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Lifestyle Communities 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. 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 held steady at AU$18.78, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Lifestyle Communities going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Lifestyle Communities (including 1 which doesn't sit too well with us) .

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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.