Shareholders in Lazydays Holdings, Inc. (NASDAQ:LAZY) had a terrible week, as shares crashed 36% to US$2.12 in the week since its latest annual results. Revenues of US$645m arrived in line with expectations, although statutory losses per share were , just a small fraction of what broker models predicted. This is an important time for investors, as they can track a company’s performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. We’ve gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.
View our latest analysis for Lazydays Holdings
NasdaqCM:LAZY Past and Future Earnings, March 21st 2020
After the latest results, the consensus from Lazydays Holdings’s one analyst is for revenues of US$595.4m in 2020, which would reflect a discernible 7.7% decline in sales compared to the last year of performance. Earnings are expected to tip over into lossmaking territory, with the analyst forecasting statutory losses of -US$0.50 per share in 2020. In the lead-up to this report, the analyst had been modelling revenues of US$644.5m and earnings per share (EPS) of US$0.06 in 2020. There looks to have been a significant drop in sentiment regarding Lazydays Holdings’s prospects after these latest results, with a minor downgrade to revenues and the analyst now forecasting a loss instead of a profit.
The average price target fell 30% to US$7.00, implicitly signalling that lower earnings per share are a leading indicator for Lazydays Holdings’s valuation.
Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that sales are expected to slow, with a forecast revenue decline of 7.7%, a significant reduction from annual growth of 6.0% over the last year. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.5% next year. It’s pretty clear that Lazydays Holdings’s revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analyst is expecting Lazydays Holdings to become unprofitable 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. Furthermore, the analyst also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that in mind, we wouldn’t be too quick to come to a conclusion on Lazydays Holdings. Long-term earnings power is much more important than next year’s profits. At least one analyst has provided forecasts out to 2021, which can be seen for free on our platform here.
You should always think about risks though. Case in point, we’ve spotted 3 warning signs for Lazydays Holdings you should be aware of, and 1 of them makes us a bit uncomfortable.
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