Limoneira Company (NASDAQ:LMNR) Analysts Are Pretty Bullish On The Stock After Recent Results

It's been a good week for Limoneira Company (NASDAQ:LMNR) shareholders, because the company has just released its latest first-quarter results, and the shares gained 3.5% to US$18.59. Results look to have been somewhat negative - revenue fell 2.1% short of analyst estimates at US$40m, although statutory losses were somewhat better. The per-share loss was US$0.21, 22% smaller than the analysts were expecting prior to the result. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Limoneira

Taking into account the latest results, the most recent consensus for Limoneira from five analysts is for revenues of US$194.9m in 2024. If met, it would imply a modest 7.2% increase on its revenue over the past 12 months. Limoneira is also expected to turn profitable, with statutory earnings of US$0.12 per share. Before this earnings report, the analysts had been forecasting revenues of US$199.2m and earnings per share (EPS) of US$0.20 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

What's most unexpected is that the consensus price target rose 7.3% to US$23.60, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip. 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. The most optimistic Limoneira analyst has a price target of US$25.00 per share, while the most pessimistic values it at US$23.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. It's clear from the latest estimates that Limoneira's rate of growth is expected to accelerate meaningfully, with the forecast 9.7% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.6% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Limoneira to grow faster than 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. They also downgraded Limoneira's revenue estimates, but industry data suggests that it 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Limoneira going out to 2025, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Limoneira that you should be aware 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.