Shareholders of Danaos Corporation (NYSE:DAC) will be pleased this week, given that the stock price is up 11% to US$4.17 following its latest first-quarter results. Overall the results were a little better than the analyst was expecting, with revenues beating forecasts by 3.1%to hit US$106m. 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 Danaos

After the latest results, the consensus from Danaos' single analyst is for revenues of US$429.9m in 2020, which would reflect a noticeable 2.4% decline in sales compared to the last year of performance. Prior to the latest earnings, the analyst was forecasting revenues of US$447.7m in 2020, and did not provide an earnings per share estimate. It looks like the analyst has become a bit less bullish on Danaos, given the revenue estimates after the latest results.

Intriguingly,the analyst has cut their price target 14% to US$7.75 showing a clear decline in sentiment around Danaos' valuation.

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 would also point out that the forecast 2.4% revenue decline is better than the historical trend, which saw revenues shrink 5.8% annually over the past five years

The Bottom Line

The most important thing to take away is that the analyst downgraded their revenue estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse than the wider industry. 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.

One Danaos broker/analyst has provided estimates out to 2021, which can be seen for free on our platform here.

It is also worth noting that we have found 3 warning signs for Danaos (2 can't be ignored!) that you need to take into consideration.

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