Earnings Beat: Nautilus, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

By
Simply Wall St
Published
November 12, 2020
NYSE:NLS

As you might know, Nautilus, Inc. (NYSE:NLS) just kicked off its latest third-quarter results with some very strong numbers. Statutory revenue and earnings both blasted past expectations, with revenue of US$155m beating expectations by 34% and earnings per share (EPS) reaching US$1.04, some 206% ahead of expectations. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Nautilus

earnings-and-revenue-growth
NYSE:NLS Earnings and Revenue Growth November 12th 2020

After the latest results, the five analysts covering Nautilus are now predicting revenues of US$553.1m in 2021. If met, this would reflect a notable 18% improvement in sales compared to the last 12 months. Per-share earnings are expected to surge 31% to US$1.61. In the lead-up to this report, the analysts had been modelling revenues of US$446.4m and earnings per share (EPS) of US$0.97 in 2021. So we can see there's been a pretty clear increase in sentiment following the latest results, with both revenues and earnings per share receiving a decent lift in the latest estimates.

It will come as no surprise to learn that the analysts have increased their price target for Nautilus 18% to US$31.00on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Nautilus analyst has a price target of US$40.00 per share, while the most pessimistic values it at US$28.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Nautilus' growth to accelerate, with the forecast 18% growth ranking favourably alongside historical growth of 0.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 14% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Nautilus is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Nautilus' earnings potential next year. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than 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 in mind, we wouldn't be too quick to come to a conclusion on Nautilus. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Nautilus going out to 2022, and you can see them free on our platform here..

Before you take the next step you should know about the 3 warning signs for Nautilus that we have uncovered.

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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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