As you might know, Kilroy Realty Corporation (NYSE:KRC) just kicked off its latest yearly results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 2.4% to hit US$955m. Statutory earnings per share (EPS) came in at US$5.36, some 2.7% above whatthe analysts had expected. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for Kilroy Realty
NYSE:KRC Earnings and Revenue Growth February 3rd 2022
After the latest results, the eight analysts covering Kilroy Realty are now predicting revenues of US$1.03b in 2022. If met, this would reflect a modest 7.8% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to tumble 75% to US$1.32 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$1.01b and earnings per share (EPS) of US$1.28 in 2022. So the consensus seems to have become somewhat more optimistic on Kilroy Realty’s earnings potential following these results.
The consensus price target was unchanged at US$78.63, 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 Kilroy Realty, with the most bullish analyst valuing it at US$85.00 and the most bearish at US$67.00 per share. This is a very narrow spread of estimates, implying either that Kilroy Realty is an easy company to value, or – more likely – the analysts are relying heavily on some key assumptions.
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. We can infer from the latest estimates that forecasts expect a continuation of Kilroy Realty’shistorical trends, as the 7.8% annualised revenue growth to the end of 2022 is roughly in line with the 7.7% annual revenue growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 8.0% per year. So although Kilroy Realty is expected to maintain its revenue growth rate, it’s only growing at about the rate of the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Kilroy Realty following these results. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Kilroy Realty going out to 2024, and you can see them free on our platform here..
You should always think about risks though. Case in point, we’ve spotted 4 warning signs for Kilroy Realty you should be aware of, and 2 of them make us uncomfortable.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.