BW Epic Kosan Ltd. Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

Investors in BW Epic Kosan Ltd. (OB:BWEK) had a good week, as its shares rose 4.5% to close at kr23.00 following the release of its first-quarter results. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$91m, statutory earnings beat expectations by a notable 50%, coming in at US$0.06 per share. Following the result, the analyst has 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 collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

View our latest analysis for BW Epic Kosan

Following last week's earnings report, BW Epic Kosan's one analyst are forecasting 2022 revenues to be US$359.0m, approximately in line with the last 12 months. Per-share earnings are expected to leap 1,681% to US$0.15. Before this earnings report, the analyst had been forecasting revenues of US$378.0m and earnings per share (EPS) of US$0.19 in 2022. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the kr25.98 price target, showing that the analyst doesn't think the changes have a meaningful impact on its intrinsic value.

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. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 2.4% by the end of 2022. This indicates a significant reduction from annual growth of 20% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 10.0% annually for the foreseeable future. The forecasts do look comparatively optimistic for BW Epic Kosan, since they're expecting it to shrink slower than the industry.

The Bottom Line

The most important thing to take away is that the analyst downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at kr25.98, with the latest estimates not enough to have an impact on their price target.

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 2024, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 5 warning signs for BW Epic Kosan (of which 2 are a bit concerning!) you should know about.

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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.