Cimpress plc Just Missed EPS By 57%: Here's What Analysts Think Will Happen Next

It's been a pretty great week for Cimpress plc (NASDAQ:CMPR) shareholders, with its shares surging 15% to US$110 in the week since its latest second-quarter results. Results overall were not great, with earnings of US$1.22 per share falling drastically short of analyst expectations. Meanwhile revenues hit US$786m and were slightly better than forecasts. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Cimpress

Taking into account the latest results, the consensus forecast from Cimpress' two analysts is for revenues of US$2.60b in 2021, which would reflect a reasonable 6.9% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 72% to US$3.45. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.60b and earnings per share (EPS) of US$3.48 in 2021. 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.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 5.1% to US$125. It looks as though they previously had some doubts over whether the business would live up to their expectations.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Cimpress' revenue growth is expected to slow, with forecast 6.9% increase next year well below the historical 10%p.a. growth over the last five years. Compare this to the 197 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 6.6% per year. So it's pretty clear that, while Cimpress' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Cimpress going out as far as 2025, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 4 warning signs for Cimpress (1 is potentially serious!) that you should be aware of.

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This article by Simply Wall St is general in nature. 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.
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