Dril-Quip, Inc. (NYSE:DRQ) shareholders are probably feeling a little disappointed, since its shares fell 4.6% to US$33.55 in the week after its latest yearly results. Revenues were in line with expectations, at US$365m, while statutory losses ballooned to US$0.87 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Check out our latest analysis for Dril-Quip
Taking into account the latest results, the eight analysts covering Dril-Quip provided consensus estimates of US$350.7m revenue in 2021, which would reflect a noticeable 3.9% decline on its sales over the past 12 months. Before this earnings report, the analysts had been forecasting revenues of US$335.2m and break-even in 2021. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a small increase to to revenue forecasts.
There's been no real change to the consensus price target of US$30.96, with Dril-Quip seemingly executing in line with expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Dril-Quip analyst has a price target of US$36.00 per share, while the most pessimistic values it at US$26.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing that stands out from these estimates is that shrinking revenues are expected to moderate over the period ending 2021 compared to the historical decline of 15% 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 see their revenue grow 6.6% per year. So while a broad number of companies are forecast to grow, unfortunately Dril-Quip is expected to see its sales affected worse than other companies in the industry.