A.G. BARR p.l.c. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

A.G. BARR p.l.c. (LON:BAG) came out with its yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It was not a great result overall. While revenues of UK£227m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 20% to hit UK£0.17 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for A.G. BARR

Taking into account the latest results, A.G. BARR's five analysts currently expect revenues in 2022 to be UK£230.4m, approximately in line with the last 12 months. Statutory earnings per share are predicted to shoot up 39% to UK£0.24. Yet prior to the latest earnings, the analysts had been anticipated revenues of UK£234.8m and earnings per share (EPS) of UK£0.24 in 2022. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The analysts reconfirmed their price target of UK£5.37, showing that the business is executing well and in line with expectations. 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. Currently, the most bullish analyst values A.G. BARR at UK£6.25 per share, while the most bearish prices it at UK£4.50. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the A.G. BARR's past performance and to peers in the same industry. It's also worth noting that the years of declining sales look to have come to an end, with the forecast for flat revenues to the end of 2022. Historically, A.G. BARR's sales have shrunk approximately 1.0% annually over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 5.7% annually. Although A.G. BARR's revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse 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 A.G. BARR going out to 2024, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for A.G. BARR that you need to be mindful of.

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