Culp, Inc. Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

Culp, Inc. (NYSE:CULP) just released its latest annual results and things are looking bullish. Culp beat earnings, with revenues hitting US$300m, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 18%. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Culp

Taking into account the latest results, the consensus forecast from Culp's two analysts is for revenues of US$325.7m in 2022, which would reflect a notable 8.7% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to soar 175% to US$0.72. Before this earnings report, the analysts had been forecasting revenues of US$300.9m and earnings per share (EPS) of US$0.67 in 2022. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 10% to US$22.00per share.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Culp's past performance and to peers in the same industry. One thing stands out from these estimates, which is that Culp is forecast to grow faster in the future than it has in the past, with revenues expected to display 8.7% annualised growth until the end of 2022. If achieved, this would be a much better result than the 4.1% annual decline 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 9.3% annually. So it looks like Culp 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 Culp's earnings potential next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same 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.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Even so, be aware that Culp is showing 1 warning sign in our investment analysis , you should know about...

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