Analysts Just Shipped A Meaningful Upgrade To Their SLC Agrícola S.A. (BVMF:SLCE3) Estimates

Celebrations may be in order for SLC Agrícola S.A. (BVMF:SLCE3) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

After this upgrade, SLC Agrícola's seven analysts are now forecasting revenues of R$4.8b in 2021. This would be a huge 44% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to leap 32% to R$4.83. Previously, the analysts had been modelling revenues of R$4.2b and earnings per share (EPS) of R$3.88 in 2021. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

See our latest analysis for SLC Agrícola

Despite these upgrades, the analysts have not made any major changes to their price target of R$55.75, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. 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 SLC Agrícola, with the most bullish analyst valuing it at R$72.00 and the most bearish at R$30.00 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.

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. The analysts are definitely expecting SLC Agrícola's growth to accelerate, with the forecast 62% annualised growth to the end of 2021 ranking favourably alongside historical growth of 15% per annum 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 4.3% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect SLC Agrícola to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The lack of change in the price target is puzzling, but with a serious upgrade to this year's earnings expectations, it might be time to take another look at SLC Agrícola.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple SLC Agrícola analysts - going out to 2023, and you can see them free on our platform here.

We also provide an overview of the SLC Agrícola Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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