Yahoo Finance Black Knight, Inc. Just Beat EPS By 30%: Here's What Analysts Think Will Happen Next
It's been a good week for Black Knight, Inc. (NYSE:BKI) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.8% to US$72.57. Revenues were US$291m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.34, an impressive 30% ahead of estimates. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
View our latest analysis for Black Knight
Following last week's earnings report, Black Knight's nine analysts are forecasting 2020 revenues to be US$1.18b, approximately in line with the last 12 months. Per-share earnings are expected to soar 43% to US$1.29. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.19b and earnings per share (EPS) of US$1.29 in 2020. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
The consensus price target rose 6.1% to US$77.55 despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Black Knight's earnings by assigning a price premium. 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. There are some variant perceptions on Black Knight, with the most bullish analyst valuing it at US$88.00 and the most bearish at US$66.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business 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 sales are expected to reverse, with the forecast 0.7% revenue decline a notable change from historical growth of 5.7% 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 11% next year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Black Knight is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Black Knight going out to 2022, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 3 warning signs for Black Knight you should know about.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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