Yahoo Finance Franco-Nevada Corporation Beat Analyst Estimates: See What The Consensus Is Forecasting For Next Year
Franco-Nevada Corporation (TSE:FNV) investors will be delighted, with the company turning in some strong numbers with its latest results. Results were good overall, with revenues beating analyst predictions by 3.0% to hit US$844m. Statutory earnings per share (EPS) came in at US$1.83, some 6.8% above what analysts had 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.
See our latest analysis for Franco-Nevada
Taking into account the latest results, the most recent consensus for Franco-Nevada from ten analysts is for revenues of US$1.01b in 2020, which is a solid 19% increase on its sales over the past 12 months. Statutory earnings per share are expected to soar 31% to US$2.41. In the lead-up to this report, analysts had been modelling revenues of US$997.4m and earnings per share (EPS) of US$2.15 in 2020. There was no real change to the revenue estimates, but analysts do seem more bullish on earnings, given the nice increase in earnings per share expectations following these results.
There's been no major changes to the consensus price target of US$111, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. The consensus price target just an average of individual analyst targets, so - considering that the price target changed, it would be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Franco-Nevada, with the most bullish analyst valuing it at US$132 and the most bearish at US$90.00 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Another way to assess these estimates is by comparing them to past performance, and seeing whether analysts are more or less bullish relative to other companies in the market. It's clear from the latest estimates that Franco-Nevada's rate of growth is expected to accelerate meaningfully, with forecast 19% revenue growth noticeably faster than its historical growth of 11%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.2% per year. It seems obvious that, while the growth outlook is brighter than the recent past, analysts also expect Franco-Nevada to grow faster than the wider market.
The Bottom Line
The most important thing to take away from this is that analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Franco-Nevada following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Franco-Nevada's revenues are expected to grow faster than the wider market. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Franco-Nevada going out to 2022, and you can see them free on our platform here.
You can also see our analysis of Franco-Nevada's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
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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