Consorcio ARA, S. A. B. de C. V. Just Missed EPS By 10%: Here's What Analysts Think Will Happen Next

Consorcio ARA, S. A. B. de C. V. (BMV:ARA) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Consorcio ARA S. A. B. de C. V missed earnings this time around, with Mex$1.8b revenue coming in 6.4% below what the analysts had modelled. Statutory earnings per share (EPS) of Mex$0.15 also fell short of expectations by 10%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Consorcio ARA S. A. B. de C. V

Taking into account the latest results, the most recent consensus for Consorcio ARA S. A. B. de C. V from two analysts is for revenues of Mex$7.37b in 2023. If met, it would imply an okay 4.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 3.0% to Mex$0.57. Yet prior to the latest earnings, the analysts had been anticipated revenues of Mex$7.42b and earnings per share (EPS) of Mex$0.54 in 2023. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 5.1% to Mex$6.71.

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. For example, we noticed that Consorcio ARA S. A. B. de C. V's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 9.8% growth to the end of 2023 on an annualised basis. That is well above its historical decline of 5.3% a year 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 10% annually. So it looks like Consorcio ARA S. A. B. de C. V is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Consorcio ARA S. A. B. de C. V's earnings potential next year. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Consorcio ARA S. A. B. de C. V that you should be aware of.

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

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.