Results: Torex Gold Resources Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

As you might know, Torex Gold Resources Inc. (TSE:TXG) just kicked off its latest quarterly results with some very strong numbers. The company beat forecasts, with revenue of US$256m, some 2.5% above estimates, and statutory earnings per share (EPS) coming in at US$0.96, 25% ahead of expectations. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Torex Gold Resources after the latest results.

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Taking into account the latest results, the current consensus from Torex Gold Resources' five analysts is for revenues of US$1.24b in 2025. This would reflect a huge 20% increase on its revenue over the past 12 months. Per-share earnings are expected to jump 34% to US$3.30. Before this earnings report, the analysts had been forecasting revenues of US$1.24b and earnings per share (EPS) of US$2.85 in 2025. Although the revenue estimates have not really changed, we can see there's been a nice gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

View our latest analysis for Torex Gold Resources

The consensus price target was unchanged at CA$61.83, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. Currently, the most bullish analyst values Torex Gold Resources at CA$71.00 per share, while the most bearish prices it at CA$55.00. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Torex Gold Resources' past performance and to peers in the same industry. It's clear from the latest estimates that Torex Gold Resources' rate of growth is expected to accelerate meaningfully, with the forecast 44% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 6.4% 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 15% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Torex Gold Resources to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Torex Gold Resources following these results. 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Torex Gold Resources. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Torex Gold Resources analysts - going out to 2027, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Torex Gold Resources that 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.