【4.5.2 for loop printing a dictionary】US$4.75 - That's What Analysts Think Century Aluminum Company (NASDAQ:CENX) Is Worth After These Results

It's been a pretty great week for

Century Aluminum Company

(

NASDAQ:CENX

) shareholders,4.5.2 for loop printing a dictionary with its shares surging 12% to US$4.55 in the week since its latest quarterly results. Revenues of US$421m arrived in line with expectations, although statutory losses per share were US$0.03, an impressive 64% smaller than what broker models predicted. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Century Aluminum

NasdaqGS:CENX Past and Future Earnings May 3rd 2020

Taking into account the latest results, the current consensus, from the four analysts covering Century Aluminum, is for revenues of US$1.57b in 2020, which would reflect a considerable 11% reduction in Century Aluminum's sales over the past 12 months. Losses are expected to increase substantially, hitting US$0.62 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$1.60b and losses of US$1.01 per share in 2020. While the revenue estimates fell, sentiment seems to have improved, with the analysts making a losses per share in particular.

The consensus price target rose 5.6% to US$4.75, with the analysts increasingly optimistic about shrinking losses, despite the expected decline in sales. 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 Century Aluminum, with the most bullish analyst valuing it at US$6.00 and the most bearish at US$4.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. Over the past five years, revenues have declined around 0.2% annually. Worse, forecasts are essentially predicting the decline to accelerate, with the estimate for a 11% decline in revenue next year. Compare this against analyst estimates for companies in the wider industry, which suggest that revenues (in aggregate) are expected to grow 9.1% next year. So it's pretty clear that, while it does have declining revenues, the analysts also expect Century Aluminum to suffer worse than the wider industry.

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The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates revenues are expected to perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings per share are more important to value creation for shareholders. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Century Aluminum. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Century Aluminum going out to 2022, and you can

see them free on our platform here.

.

Before you take the next step you should know about the

2 warning signs for Century Aluminum

that we have uncovered.

If you spot an error that warrants correction, please contact the editor at

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. 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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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