Century Aluminum Company Just Beat EPS By 53%: Here's What Analysts Think Will Happen Next

Shareholders will be ecstatic, with their stake up 25% over the past week following Century Aluminum Company's (NASDAQ:CENX) latest third-quarter results. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$539m, statutory earnings beat expectations by a notable 53%, coming in at US$0.46 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Century Aluminum

Taking into account the latest results, the current consensus from Century Aluminum's dual analysts is for revenues of US$2.37b in 2025. This would reflect a solid 13% increase on its revenue over the past 12 months. Statutory earnings per share are expected to tumble 37% to US$2.09 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.25b and earnings per share (EPS) of US$0.77 in 2025. So it seems there's been a definite increase in optimism about Century Aluminum's future following the latest results, with a sizeable expansion in the earnings per share forecasts in particular.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 11% to US$21.00per share.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Century Aluminum's rate of growth is expected to accelerate meaningfully, with the forecast 10% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 6.6% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Century Aluminum to grow faster than 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 Century Aluminum's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

However, before you get too enthused, we've discovered 4 warning signs for Century Aluminum (3 are a bit unpleasant!) 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.