Lendlease Group Just Reported A Surprise Loss: Here's What Analysts Think Will Happen Next

Lendlease Group (ASX:LLC) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues missed expectations, with revenue of AU$9.4b falling 13% short of forecasts. Earnings correspondingly dipped, with Lendlease Group reporting a statutory loss of AU$2.18 per share, where the analysts were expecting a profit. 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.

Check out our latest analysis for Lendlease Group

Taking into account the latest results, the current consensus, from the eight analysts covering Lendlease Group, is for revenues of AU$7.65b in 2025. This implies an uncomfortable 18% reduction in Lendlease Group's revenue over the past 12 months. Earnings are expected to improve, with Lendlease Group forecast to report a statutory profit of AU$0.53 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$9.58b and earnings per share (EPS) of AU$0.64 in 2025. It looks like sentiment has declined substantially in the aftermath of these results, with a pretty serious reduction to revenue estimates and a real cut to earnings per share numbers as well.

The analysts made no major changes to their price target of AU$7.14, suggesting the downgrades are not expected to have a long-term impact on Lendlease Group'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 Lendlease Group analyst has a price target of AU$10.00 per share, while the most pessimistic values it at AU$6.20. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. One more thing stood out to us about these estimates, and it's the idea that Lendlease Group's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 18% to the end of 2025. This tops off a historical decline of 8.9% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 2.7% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Lendlease Group to suffer worse than the wider 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Lendlease Group analysts - going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Lendlease Group 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.