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Last week, you might have seen that MDA Ltd. (TSE:MDA) released its first-quarter result to the market. The early response was not positive, with shares down 4.4% to CA$14.00 in the past week. It looks like a credible result overall - although revenues of CA$209m were what the analysts expected, MDA surprised by delivering a (statutory) profit of CA$0.11 per share, an impressive 32% above what was forecast. 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.
See our latest analysis for MDA
Taking into account the latest results, the consensus forecast from MDA's seven analysts is for revenues of CA$1.01b in 2024. This reflects a substantial 24% improvement in revenue compared to the last 12 months. Per-share earnings are expected to bounce 42% to CA$0.55. In the lead-up to this report, the analysts had been modelling revenues of CA$1.01b and earnings per share (EPS) of CA$0.57 in 2024. 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 CA$16.29, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. There are some variant perceptions on MDA, with the most bullish analyst valuing it at CA$19.00 and the most bearish at CA$14.00 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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. It's clear from the latest estimates that MDA's rate of growth is expected to accelerate meaningfully, with the forecast 33% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 14% over the past year. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.5% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect MDA to grow faster than the wider industry.