Analysts Are Updating Their Coronado Global Resources Inc. (ASX:CRN) Estimates After Its Third-Quarter Results
Shareholders of Coronado Global Resources Inc. (ASX:CRN) will be pleased this week, given that the stock price is up 11% to AU$0.15 following its latest quarterly results. The result was fairly weak overall, with revenues of US$564m being 7.4% less than what the analysts had been modelling. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from Coronado Global Resources' five analysts is for revenues of US$2.51b in 2027. This reflects a solid 20% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Coronado Global Resources forecast to report a statutory profit of US$0.024 per share. In the lead-up to this report, the analysts had been modelling revenues of US$2.51b and earnings per share (EPS) of US$0.045 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the large cut to new EPS forecasts.
Check out our latest analysis for Coronado Global Resources
It might be a surprise to learn that the consensus price target was broadly unchanged at AU$0.18, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Coronado Global Resources at AU$0.22 per share, while the most bearish prices it at AU$0.12. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Coronado Global Resources' past performance and to peers in the same industry. For example, we noticed that Coronado Global Resources' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 15% growth to the end of 2027 on an annualised basis. That is well above its historical decline of 7.6% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 6.1% per year. Not only are Coronado Global Resources' revenues expected to improve, it seems that the analysts are also expecting it 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at AU$0.18, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Coronado Global Resources. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Coronado Global Resources analysts - going out to 2028, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Coronado Global Resources , and understanding this should be part of your investment process.
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