Cardtronics plc Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Cardtronics plc (NASDAQ:CATM) shares fell 9.2% to US$38.51 in the week since its latest full-year results. Cardtronics reported US$1.3b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.05 beat expectations, being 6.1% higher than what analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether analysts have changed their earnings models, following these results.
View our latest analysis for Cardtronics
Taking into account the latest results, the latest consensus from Cardtronics's six analysts is for revenues of US$1.39b in 2020, which would reflect an okay 3.2% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to reduce 5.2% to US$1.01 in the same period. In the lead-up to this report, analysts had been modelling revenues of US$1.40b and earnings per share (EPS) of US$1.41 in 2020. Analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.
Despite cutting their earnings forecasts, analysts have lifted their price target 6.0% to US$48.92, suggesting that these impacts are not expected to weigh on the stock's value in the long term. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Cardtronics at US$52.00 per share, while the most bearish prices it at US$45.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or that analysts have a clear view on its prospects.
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. It's pretty clear that analysts expect Cardtronics's revenue growth will slow down substantially, with revenues next year expected to grow 3.2%, compared to a historical growth rate of 4.6% over the past five years. Compare this against other companies (with analyst forecasts) in the market, which are in aggregate expected to see revenue growth of 11% next year. Factoring in the forecast slowdown in growth, it seems obvious that analysts still expect Cardtronics to grow slower than the wider market.
The Bottom Line
The biggest concern with the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Cardtronics. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that Cardtronics's revenues are expected to perform worse than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Cardtronics going out to 2021, and you can see them free on our platform here.
You can also view our analysis of Cardtronics's balance sheet, and whether we think Cardtronics is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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