Green Plains Inc. (NASDAQ:GPRE) Analysts Are Cutting Their Estimates: Here's What You Need To Know

Green Plains Inc. (NASDAQ:GPRE) just released its latest full-year report and things are not looking great. The numbers were fairly weak, with revenue of US$3.3b missing analyst predictions by 2.9%, and (statutory) losses of US$1.59 per share being slightly larger than what the analysts had expected. Following the result, the analysts have 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Green Plains

Following the recent earnings report, the consensus from ten analysts covering Green Plains is for revenues of US$2.80b in 2024. This implies a not inconsiderable 15% decline in revenue compared to the last 12 months. Green Plains is also expected to turn profitable, with statutory earnings of US$1.04 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$3.08b and earnings per share (EPS) of US$1.29 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the US$34.65 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Green Plains, with the most bullish analyst valuing it at US$55.00 and the most bearish at US$24.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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 revenue is expected to slow, with a forecast annualised decline of 15% by the end of 2024. This indicates a significant reduction from annual growth of 9.9% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 0.9% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Green Plains is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts 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 underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Green Plains going out to 2026, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 1 warning sign for Green Plains 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.