News Flash: Analysts Just Made A Captivating Upgrade To Their Macro Enterprises Inc. (CVE:MCR) Forecasts

Shareholders in Macro Enterprises Inc. (CVE:MCR) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The consensus estimated revenue numbers rose, with their view now clearly much more bullish on the company's business prospects.

After the upgrade, the two analysts covering Macro Enterprises are now predicting revenues of CA$283m in 2021. If met, this would reflect a reasonable 6.9% improvement in sales compared to the last 12 months. Per-share earnings are expected to soar 44% to CA$0.45. Before this latest update, the analysts had been forecasting revenues of CA$246m and earnings per share (EPS) of CA$0.41 in 2021. The most recent forecasts are noticeably more optimistic, with a nice increase in revenue estimates and a lift to earnings per share as well.

Check out our latest analysis for Macro Enterprises

Despite these upgrades, the analysts have not made any major changes to their price target of CA$6.50, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Macro Enterprises, with the most bullish analyst valuing it at CA$10.00 and the most bearish at CA$4.50 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.

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. We would highlight that Macro Enterprises' revenue growth is expected to slow, with forecast 6.9% increase next year well below the historical 37% p.a. growth over the last five years. Compare this to the 27 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 6.3% per year. Factoring in the forecast slowdown in growth, it looks like Macro Enterprises is forecast to grow at about the same rate as 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 next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Macro Enterprises.

Analysts are definitely bullish on Macro Enterprises, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including concerns around earnings quality. You can learn more, and discover the 2 other flags we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

If you’re looking to trade Macro Enterprises, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.