Emerald Resources NL Just Recorded A 15% EPS Beat: Here's What Analysts Are Forecasting Next

Emerald Resources NL (ASX:EMR) came out with its yearly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Revenues were AU$612m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of AU$0.39 were also better than expected, beating analyst predictions by 15%. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the current consensus from Emerald Resources' twin analysts is for revenues of AU$668.7m in 2027. This would reflect a decent 9.2% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 3.3% to AU$0.41. Before this earnings report, the analysts had been forecasting revenues of AU$692.4m and earnings per share (EPS) of AU$0.42 in 2027. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

See our latest analysis for Emerald Resources

The consensus price target fell 8.6% to AU$7.43, with the weaker earnings outlook clearly leading valuation estimates.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Emerald Resources' revenue growth is expected to slow, with the forecast 9.2% annualised growth rate until the end of 2027 being well below the historical 32% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 6.2% per year. Even after the forecast slowdown in growth, it seems obvious that Emerald Resources is also expected 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. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will 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 Emerald Resources. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Emerald Resources going out as far as 2029, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.