Yahoo Finance Results: Alimentation Couche-Tard Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
The quarterly results for Alimentation Couche-Tard Inc. (TSE:ATD.B) were released last week, making it a good time to revisit its performance. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$11b, statutory earnings beat expectations by a notable 33%, coming in at US$0.68 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for Alimentation Couche-Tard
Taking into account the latest results, the current consensus, from the eleven analysts covering Alimentation Couche-Tard, is for revenues of US$45.7b in 2021, which would reflect a noticeable 2.1% reduction in Alimentation Couche-Tard's sales over the past 12 months. Statutory earnings per share are expected to plummet 21% to US$1.97 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$47.5b and earnings per share (EPS) of US$1.80 in 2021. If anything, the analysts look to have become slightly more optimistic overall; while they decreased their revenue forecasts, EPS predictions increased and ultimately earnings are more important.
The consensus has made no major changes to the price target of US$40.26, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Alimentation Couche-Tard, with the most bullish analyst valuing it at US$55.00 and the most bearish at US$49.33 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
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. We would highlight that sales are expected to reverse, with the forecast 2.1% revenue decline a notable change from historical growth of 12% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.9% annually for the foreseeable future. It's pretty clear that Alimentation Couche-Tard's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Alimentation Couche-Tard's earnings potential next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings per share are more important to value creation for shareholders. The consensus price target held steady at US$40.26, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Alimentation Couche-Tard going out to 2025, and you can see them free on our platform here..
Plus, you should also learn about the 2 warning signs we've spotted with Alimentation Couche-Tard .
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. 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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