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West Fraser Timber Co. Ltd. (TSE:WFG) just released its latest quarterly results and things are looking bullish. It was overall a positive result, with revenues beating expectations by 8.1% to hit US$1.7b. West Fraser Timber also reported a statutory profit of US$1.21, which was an impressive 47% above what the analysts had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Check out our latest analysis for West Fraser Timber
Taking into account the latest results, the current consensus, from the six analysts covering West Fraser Timber, is for revenues of US$6.22b in 2024. This implies a measurable 5.1% reduction in West Fraser Timber's revenue over the past 12 months. Statutory earnings per share are predicted to leap 56% to US$2.80. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$6.35b and earnings per share (EPS) of US$4.95 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.
The average price target climbed 7.2% to CA$134despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic West Fraser Timber analyst has a price target of CA$138 per share, while the most pessimistic values it at CA$129. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 9.9% annualised decline to the end of 2024. That is a notable change from historical growth of 13% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.8% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - West Fraser Timber is expected to lag the wider industry.