Sanford Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Sanford Limited (NZSE:SAN) came out with its full-year 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 looks like a pretty bad result, all things considered. Although revenues of NZ$553m were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 39% to hit NZ$0.11 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sanford after the latest results.

View our latest analysis for Sanford

After the latest results, the dual analysts covering Sanford are now predicting revenues of NZ$579.1m in 2024. If met, this would reflect a credible 4.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 231% to NZ$0.35. Yet prior to the latest earnings, the analysts had been anticipated revenues of NZ$600.3m and earnings per share (EPS) of NZ$0.34 in 2024. If anything, the analysts look to have become slightly more optimistic overall; while they decreased their revenue forecasts, EPS predictions increased and ultimately earnings are more important.

There's been no real change to the average price target of NZ$4.58, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe.

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. The analysts are definitely expecting Sanford's growth to accelerate, with the forecast 4.7% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.0% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 6.3% annually. So it's clear that despite the acceleration in growth, Sanford is expected to grow meaningfully slower than the industry average.

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 Sanford following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings per share are more important to value creation for shareholders. 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 Sanford. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Sanford going out as far as 2026, 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 Sanford that you need to be mindful 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.