M. Dias Branco S.A. Indústria e Comércio de Alimentos Just Recorded A 6.6% EPS Beat: Here's What Analysts Are Forecasting Next

It's been a good week for M. Dias Branco S.A. Indústria e Comércio de Alimentos (BVMF:MDIA3) shareholders, because the company has just released its latest full-year results, and the shares gained 5.1% to R$40.98. M. Dias Branco Indústria e Comércio de Alimentos reported R$11b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of R$2.63 beat expectations, being 6.6% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for M. Dias Branco Indústria e Comércio de Alimentos

Following last week's earnings report, M. Dias Branco Indústria e Comércio de Alimentos' six analysts are forecasting 2024 revenues to be R$10.9b, approximately in line with the last 12 months. Per-share earnings are expected to leap 25% to R$3.30. Yet prior to the latest earnings, the analysts had been anticipated revenues of R$11.1b and earnings per share (EPS) of R$3.78 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a real cut to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the R$46.50 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. 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. Currently, the most bullish analyst values M. Dias Branco Indústria e Comércio de Alimentos at R$50.00 per share, while the most bearish prices it at R$39.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting M. Dias Branco Indústria e Comércio de Alimentos is an easy business to forecast or the the analysts are all using similar assumptions.

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. It's pretty clear that there is an expectation that M. Dias Branco Indústria e Comércio de Alimentos' revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 0.2% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 3.9% per year. Factoring in the forecast slowdown in growth, it seems obvious that M. Dias Branco Indústria e Comércio de Alimentos is also expected to grow slower than other industry participants.

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. 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple M. Dias Branco Indústria e Comércio de Alimentos analysts - going out to 2026, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.