Capstone Copper Corp. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Capstone Copper Corp. (TSE:CS) missed earnings with its latest second-quarter results, disappointing overly-optimistic forecasters. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$543m, statutory earnings missed forecasts by an incredible 24%, coming in at just US$0.03 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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After the latest results, the 15 analysts covering Capstone Copper are now predicting revenues of US$2.28b in 2025. If met, this would reflect a solid 17% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 74% to US$0.17. Before this earnings report, the analysts had been forecasting revenues of US$2.23b and earnings per share (EPS) of US$0.18 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

Check out our latest analysis for Capstone Copper

The consensus price target held steady at CA$11.05, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Capstone Copper, with the most bullish analyst valuing it at CA$13.00 and the most bearish at CA$7.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Capstone Copper's rate of growth is expected to accelerate meaningfully, with the forecast 37% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 26% p.a. 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 16% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Capstone Copper to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Capstone Copper. 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. 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 forecasts for Capstone Copper going out to 2027, and you can see them free on our platform here.

You can also see whether Capstone Copper is carrying too much debt, and whether its balance sheet is healthy, for free 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.