Global Net Lease, Inc. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Simply Wall St
·4 min read

Investors in Global Net Lease, Inc. (NYSE:GNL) had a good week, as its shares rose 2.8% to close at US$18.58 following the release of its annual results. Revenues came in at US$330m, in line with estimates, while Global Net Lease reported a statutory loss of US$0.09 per share, well short of prior analyst forecasts for a profit. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Global Net Lease

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Taking into account the latest results, the current consensus from Global Net Lease's five analysts is for revenues of US$377.1m in 2021, which would reflect a notable 14% increase on its sales over the past 12 months. Global Net Lease is also expected to turn profitable, with statutory earnings of US$0.03 per share. In the lead-up to this report, the analysts had been modelling revenues of US$362.2m and earnings per share (EPS) of US$0.11 in 2021. While next year's revenue estimates increased, there was also a pretty serious reduction to EPS expectations, suggesting the consensus has a bit of a mixed view of these results.

There's been no major changes to the price target of US$22.00, suggesting that the impact of higher forecast sales and lower earnings won't result in a meaningful change to the business' valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Global Net Lease, with the most bullish analyst valuing it at US$24.00 and the most bearish at US$20.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's clear from the latest estimates that Global Net Lease's rate of growth is expected to accelerate meaningfully, with the forecast 14% revenue growth noticeably faster than its historical growth of 9.9%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.6% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Global Net Lease to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. The consensus price target held steady at US$22.00, with the latest estimates not enough to have an impact on their price targets.

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 Global Net Lease going out to 2023, and you can see them free on our platform here..

You still need to take note of risks, for example - Global Net Lease has 2 warning signs (and 1 which is potentially serious) we think you should know about.

This article by Simply Wall St is general in nature. 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.

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