Last week saw the newest annual earnings release from Atalaya Mining Plc (LON:ATYM), an important milestone in the company's journey to build a stronger business. It looks like the results were a bit of a negative overall. While revenues of €406m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.9% to hit €0.94 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Atalaya Mining after the latest results.
See our latest analysis for Atalaya Mining
Following the latest results, Atalaya Mining's five analysts are now forecasting revenues of €428.9m in 2022. This would be a satisfactory 5.7% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to decline 11% to €0.85 in the same period. Before this earnings report, the analysts had been forecasting revenues of €435.0m and earnings per share (EPS) of €0.93 in 2022. 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 minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at UK£5.08, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Atalaya Mining analyst has a price target of UK£5.50 per share, while the most pessimistic values it at UK£4.60. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
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. We would highlight that Atalaya Mining's revenue growth is expected to slow, with the forecast 5.7% annualised growth rate until the end of 2022 being well below the historical 21% p.a. growth over the last five years. Compare this with other companies in the same industry, which are forecast to see a revenue decline of 4.0% annually. So it's clear that despite the slowdown in growth, Atalaya Mining is still expected to grow meaningfully faster than the wider industry.