Meridian Holdings Inc. Just Missed Earnings With A Surprise Loss - Here Are Analysts Latest Forecasts
One of the biggest stories of last week was how Meridian Holdings Inc. (NASDAQ:MRDN) shares plunged 37% in the week since its latest quarterly results, closing yesterday at US$5.77. Revenues missed expectations, with revenue of US$46m falling 11% short of forecasts. Earnings correspondingly dipped, with Meridian Holdings reporting a statutory loss of US$1.05 per share, where the analysts were expecting a profit. 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.
Taking into account the latest results, the current consensus from Meridian Holdings' two analysts is for revenues of US$211.0m in 2027. This would reflect a modest 7.7% increase on its revenue over the past 12 months. Meridian Holdings is also expected to turn profitable, with statutory earnings of US$1.15 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$227.4m and earnings per share (EPS) of US$1.15 in 2027. The consensus seems maybe a little more pessimistic, trimming their revenue forecasts after the latest results even though there was no change to its EPS estimates.
View our latest analysis for Meridian Holdings
It will come as no surprise then, that the consensus price target fell 10% to US$17.73following these changes.
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 Meridian Holdings' revenue growth is expected to slow, with the forecast 6.1% annualised growth rate until the end of 2027 being well below the historical 27% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.1% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Meridian Holdings.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Yet - earnings are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Meridian Holdings' future valuation.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At least one analyst has provided forecasts out to 2028, which can be seen for free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Meridian Holdings , and understanding these should be part of your investment process.
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