Earnings Beat: Ferroglobe PLC Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Ferroglobe PLC (NASDAQ:GSM) just released its quarterly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 6.0% to hit US$451m. Ferroglobe also reported a statutory profit of US$0.18, which was an impressive 64% above what the analysts had forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Ferroglobe after the latest results.

Check out our latest analysis for Ferroglobe

Taking into account the latest results, the current consensus from Ferroglobe's two analysts is for revenues of US$1.68b in 2024. This would reflect a satisfactory 2.8% increase on its revenue over the past 12 months. Per-share earnings are expected to grow 14% to US$0.38. Before this earnings report, the analysts had been forecasting revenues of US$1.68b and earnings per share (EPS) of US$0.23 in 2024. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the very substantial lift in earnings per share expectations following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 10% to US$11.00.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Ferroglobe'shistorical trends, as the 5.8% annualised revenue growth to the end of 2024 is roughly in line with the 5.6% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 5.1% per year. It's clear that while Ferroglobe's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Ferroglobe's earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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.

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. We have analyst estimates for Ferroglobe going out as far as 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 Ferroglobe 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.