Earnings Miss: Spin Master Corp. Missed EPS By 49% And Analysts Are Revising Their Forecasts

It's been a mediocre week for Spin Master Corp. (TSE:TOY) shareholders, with the stock dropping 11% to CA$27.00 in the week since its latest yearly results. It looks like a pretty bad result, all things considered. Although revenues of US$2.3b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 49% to hit US$0.77 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Spin Master

After the latest results, the eight analysts covering Spin Master are now predicting revenues of US$2.37b in 2025. If met, this would reflect a reasonable 4.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 188% to US$2.30. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.37b and earnings per share (EPS) of US$2.11 in 2025. So the consensus seems to have become somewhat more optimistic on Spin Master's earnings potential following these results.

The average the analysts price target fell 8.6% to CA$39.19, suggesting thatthe analysts have other concerns, and the improved earnings per share outlook was not enough to allay them. 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 Spin Master analyst has a price target of CA$47.12 per share, while the most pessimistic values it at CA$32.08. 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.

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 period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 4.8% growth on an annualised basis. That is in line with its 5.7% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.2% annually. So although Spin Master is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Spin Master's earnings potential next year. 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 fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Spin Master's future valuation.

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 Spin Master analysts - going out to 2027, and you can see them free on our platform here.

Even so, be aware that Spin Master is showing 1 warning sign in our investment analysis , 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.