editorial-team@simplywallst.com (Simply Wall St)
3 min read
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Last week, you might have seen that Magna International Inc. (TSE:MG) released its quarterly result to the market. The early response was not positive, with shares down 3.0% to CA$45.95 in the past week. Results overall were not great, with earnings of US$0.52 per share falling drastically short of analyst expectations. Meanwhile revenues hit US$10b and were slightly better than forecasts. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there’s been a strong change in the company’s prospects, or if it’s business as usual. We’ve gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
After the latest results, the consensus from Magna International’s 15 analysts is for revenues of US$39.7b in 2025, which would reflect a perceptible 5.4% decline in revenue compared to the last year of performance. Per-share earnings are expected to step up 12% to US$4.55. Before this earnings report, the analysts had been forecasting revenues of US$39.3b and earnings per share (EPS) of US$4.34 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
Check out our latest analysis for Magna International
The consensus price target was unchanged at CA$57.66, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Magna International, with the most bullish analyst valuing it at CA$77.06 and the most bearish at CA$43.03 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 7.1% by the end of 2025. This indicates a significant reduction from annual growth of 5.7% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 8.4% annually for the foreseeable future. It’s pretty clear that Magna International’s revenues are expected to perform substantially worse than the wider industry.
