Schweitzer-Mauduit International, Inc. (NYSE:SWM) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 8.1% to hit US$279m. Schweitzer-Mauduit International reported statutory earnings per share (EPS) US$0.78, which was a notable 11% above what the analysts had forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, Schweitzer-Mauduit International's dual analysts are now forecasting revenues of US$1.07b in 2021. This would be a credible 3.8% improvement in sales compared to the last 12 months. Per-share earnings are expected to shoot up 27% to US$3.64. Before this earnings report, the analysts had been forecasting revenues of US$1.06b and earnings per share (EPS) of US$3.35 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 8.9% to US$49.00.
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. We would highlight that Schweitzer-Mauduit International's revenue growth is expected to slow, with forecast 3.8% increase next year well below the historical 6.6%p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 0.7% next year. So it's pretty clear that, while Schweitzer-Mauduit International's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Schweitzer-Mauduit International following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Schweitzer-Mauduit International going out as far as 2022, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Schweitzer-Mauduit International , and understanding it should be part of your investment process.
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