US$10.13: That's What Analysts Think The E.W. Scripps Company (NASDAQ:SSP) Is Worth After Its Latest Results

It's been a mediocre week for The E.W. Scripps Company (NASDAQ:SSP) shareholders, with the stock dropping 19% to US$3.61 in the week since its latest quarterly results. Revenues of US$561m arrived in line with expectations, although statutory losses per share were US$0.15, an impressive 38% smaller than what broker models predicted. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for E.W. Scripps

Taking into account the latest results, the consensus forecast from E.W. Scripps' five analysts is for revenues of US$2.52b in 2024. This reflects a solid 8.3% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with E.W. Scripps forecast to report a statutory profit of US$0.99 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.52b and earnings per share (EPS) of US$0.99 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With no major changes to earnings forecasts, the consensus price target fell 11% to US$10.13, suggesting that the analysts might have previously been hoping for an earnings upgrade. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values E.W. Scripps at US$17.00 per share, while the most bearish prices it at US$3.50. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of E.W. Scripps'historical trends, as the 11% annualised revenue growth to the end of 2024 is roughly in line with the 13% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 3.2% per year. So although E.W. Scripps is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on E.W. Scripps. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple E.W. Scripps analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - E.W. Scripps has 1 warning sign we think 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.