Results: Endeavour Silver Corp. Delivered A Surprise Loss And Now Analysts Have New Forecasts

Shareholders in Endeavour Silver Corp. (TSE:EDR) had a terrible week, as shares crashed 23% to CA$4.63 in the week since its latest second-quarter results. It looks like a pretty bad result, given that revenues fell 11% short of analyst estimates at US$59m, and the company reported a statutory loss of US$0.061 per share instead of the profit that the analysts had been forecasting. 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.

See our latest analysis for Endeavour Silver

After the latest results, the three analysts covering Endeavour Silver are now predicting revenues of US$249.2m in 2024. If met, this would reflect a solid 12% improvement in revenue compared to the last 12 months. Statutory losses are forecast to balloon 83% to US$0.01 per share. In the lead-up to this report, the analysts had been modelling revenues of US$248.0m and earnings per share (EPS) of US$0.069 in 2024. While the analysts have made no real change to their revenue estimates, we can see that the consensus is now modelling a loss next year - a clear dip in sentiment compared to the previous outlook of a profit.

As a result, there was no major change to the consensus price target of CA$7.17, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Endeavour Silver analyst has a price target of CA$7.50 per share, while the most pessimistic values it at CA$7.00. 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.

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. It's clear from the latest estimates that Endeavour Silver's rate of growth is expected to accelerate meaningfully, with the forecast 26% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 15% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Endeavour Silver is expected to grow much faster than its industry.

The Bottom Line

The biggest low-light for us was that the forecasts for Endeavour Silver dropped from profits to a loss 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 held steady at CA$7.17, with the latest estimates not enough to have an impact on their price targets.

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 Endeavour Silver analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Endeavour Silver you should be aware of.

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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.

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