Yahoo Finance AU$6.49 - That's What Analysts Think Qantas Airways Limited (ASX:QAN) Is Worth After These Results
Shareholders of Qantas Airways Limited (ASX:QAN) will be pleased this week, given that the stock price is up 10% to AU$5.18 following its latest annual results. It looks like a positive result overall, with revenues of AU$9.1b beating forecasts by 4.9%. Statutory losses of AU$0.46 per share were roughly in line with what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 Qantas Airways
Taking into account the latest results, the consensus forecast from Qantas Airways' 16 analysts is for revenues of AU$17.7b in 2023, which would reflect a substantial 94% improvement in sales compared to the last 12 months. Qantas Airways is also expected to turn profitable, with statutory earnings of AU$0.38 per share. Before this earnings report, the analysts had been forecasting revenues of AU$16.9b and earnings per share (EPS) of AU$0.28 in 2023. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a considerable lift to earnings per share in particular.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 6.0% to AU$6.49per share. 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. Currently, the most bullish analyst values Qantas Airways at AU$7.70 per share, while the most bearish prices it at AU$4.28. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Qantas Airways' past performance and to peers in the same industry. For example, we noticed that Qantas Airways' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 94% growth to the end of 2023 on an annualised basis. That is well above its historical decline of 19% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 18% per year. Not only are Qantas Airways' revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Qantas Airways' earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Qantas Airways going out to 2025, and you can see them free on our platform here..
Plus, you should also learn about the 1 warning sign we've spotted with Qantas Airways .
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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