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Investors in Green Brick Partners, Inc. (NYSE:GRBK) had a good week, as its shares rose 4.6% to close at US$60.21 following the release of its first-quarter results. Revenues of US$498m were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$1.67, missing estimates by 4.8%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
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After the latest results, the consensus from Green Brick Partners' twin analysts is for revenues of US$2.01b in 2025, which would reflect a discernible 6.6% decline in revenue compared to the last year of performance. Statutory earnings per share are expected to drop 19% to US$6.85 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.12b and earnings per share (EPS) of US$7.74 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.
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What's most unexpected is that the consensus price target rose 22% to US$70.00, strongly implying the downgrade to forecasts is not expected to be more than a temporary blip.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 8.7% by the end of 2025. This indicates a significant reduction from annual growth of 17% 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 4.4% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Green Brick Partners is expected to lag the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Green Brick Partners. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.