Celebrations may be in order for Alexander & Baldwin, Inc. (NYSE:ALEX) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts greatly increased their revenue estimates, suggesting a stark improvement in business fundamentals.
After this upgrade, Alexander & Baldwin’s two analysts are now forecasting revenues of US$371m in 2021. This would be a solid 19% improvement in sales compared to the last 12 months. Per-share earnings are expected to soar 254% to US$0.48. Before this latest update, the analysts had been forecasting revenues of US$330m and earnings per share (EPS) of US$0.41 in 2021. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue 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. The analysts are definitely expecting Alexander & Baldwin’s growth to accelerate, with the forecast 26% annualised growth to the end of 2021 ranking favourably alongside historical growth of 0.4% per annum 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 6.7% per year. Factoring in the forecast acceleration in revenue, it’s pretty clear that Alexander & Baldwin is expected to grow much faster than its industry.
The Bottom Line
The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. With a serious upgrade to expectations, it might be time to take another look at Alexander & Baldwin.
Still, the long-term prospects of the business are much more relevant than next year’s earnings. We have analyst estimates for Alexander & Baldwin going out as far as 2022, and you can see them free on our platform here.
Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.
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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