Here’s What Analysts Are Forecasting Now
Alliance Aviation Services Limited (ASX:AQZ) missed earnings with its latest full-year results, disappointing overly-optimistic forecasters. It wasn’t a great result overall – while revenue fell marginally short of analyst estimates at AU$309m, statutory earnings missed forecasts by 18%, coming in at just AU$0.21 per share. 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.
Check out our latest analysis for Alliance Aviation Services
Taking into account the latest results, the current consensus from Alliance Aviation Services’ four analysts is for revenues of AU$415.9m in 2022, which would reflect a huge 35% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 25% to AU$0.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$397.3m and earnings per share (EPS) of AU$0.27 in 2022. So it’s pretty clear consensus is mixed on Alliance Aviation Services after the latest results; whilethe analysts lifted revenue numbers, they also administered a minor downgrade to per-share earnings expectations.
There’s been no major changes to the price target of AU$5.03, suggesting that the impact of higher forecast sales and lower earnings won’t result in a meaningful change to the business’ valuation. The consensus price target is just an average of individual analyst targets, so – it could be handy to see how wide the range of underlying estimates is. The most optimistic Alliance Aviation Services analyst has a price target of AU$5.30 per share, while the most pessimistic values it at AU$4.58. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Alliance Aviation Services is an easy business to forecast or the the analysts are all using similar assumptions.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Alliance Aviation Services’ past performance and to peers in the same industry. The analysts are definitely expecting Alliance Aviation Services’ growth to accelerate, with the forecast 35% annualised growth to the end of 2022 ranking favourably alongside historical growth of 11% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 25% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Alliance Aviation Services 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. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. The consensus price target held steady at AU$5.03, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. We have forecasts for Alliance Aviation Services going out to 2024, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Alliance Aviation Services (1 is a bit unpleasant!) that you need to take into consideration.
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.
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