In This Article:
Investors in Warrior Met Coal, Inc. (NYSE:HCC) had a good week, as its shares rose 6.8% to close at US$64.64 following the release of its quarterly results. Revenues were US$328m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.80 were also better than expected, beating analyst predictions by 12%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Warrior Met Coal after the latest results.
View our latest analysis for Warrior Met Coal
Taking into account the latest results, the four analysts covering Warrior Met Coal provided consensus estimates of US$1.55b revenue in 2025, which would reflect a noticeable 2.9% decline over the past 12 months. Statutory earnings per share are expected to drop 14% to US$6.26 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$1.54b and earnings per share (EPS) of US$6.47 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
The consensus price target held steady at US$76.00, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Warrior Met Coal at US$90.00 per share, while the most bearish prices it at US$70.00. This is a very narrow spread of estimates, implying either that Warrior Met Coal is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 2.3% by the end of 2025. This indicates a significant reduction from annual growth of 13% 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 5.4% annually for the foreseeable future. It's pretty clear that Warrior Met Coal's revenues are expected to perform substantially worse than the wider industry.