Rumo S.A. (BVMF:RAIL3) Just Released Its First-Quarter Results And Analysts Are Updating Their Estimates

As you might know, Rumo S.A. (BVMF:RAIL3) recently reported its quarterly numbers. Overall the results were a little better than the analysts were expecting, with revenues beating forecasts by 6.2%to hit R$3.1b. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Rumo after the latest results.

Check out our latest analysis for Rumo

After the latest results, the ten analysts covering Rumo are now predicting revenues of R$13.3b in 2024. If met, this would reflect a solid 14% improvement in revenue compared to the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of R$13.2b and earnings per share (EPS) of R$1.13 in 2024. So we can see that while the consensus made no real change to its revenue estimates, it also no longer provides an earnings per share estimate. This suggests that revenues are what the market is focusing on after the latest results.

We'd also point out that thatthe analysts have made no major changes to their price target of R$28.85. 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. The most optimistic Rumo analyst has a price target of R$31.00 per share, while the most pessimistic values it at R$24.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. It's clear from the latest estimates that Rumo's rate of growth is expected to accelerate meaningfully, with the forecast 19% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 11% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Rumo to grow faster than the wider industry.

The Bottom Line

The clear take away from these updates is that the analysts made no change to their revenue estimates for next year, with the business apparently performing in line with their models. 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.

We have estimates for Rumo from its ten analysts out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 2 warning signs for Rumo (of which 1 is a bit unpleasant!) you should know about.

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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.