Results: Perrigo Company plc Exceeded Expectations And The Consensus Has Updated Its Estimates

Shareholders will be ecstatic, with their stake up 27% over the past week following Perrigo Company plc‘s (NYSE:PRGO) latest quarterly results. It looks like a credible result overall – although revenues of US$1.0b were what the analysts expected, Perrigo surprised by delivering a (statutory) profit of US$0.53 per share, an impressive 47% above what was forecast. 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. Readers will be glad to know we’ve aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Perrigo after the latest results.

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Taking into account the latest results, the current consensus, from the four analysts covering Perrigo, is for revenues of US$4.06b in 2026. This implies a measurable 2.1% reduction in Perrigo’s revenue over the past 12 months. Losses are predicted to fall substantially, shrinking 87% to US$1.60. Before this latest report, the consensus had been expecting revenues of US$4.06b and US$0.14 per share in losses. So it’s pretty clear the analysts have mixed opinions on Perrigo even after this update; although they reconfirmed their revenue numbers, it came at the cost of a very substantial increase in per-share losses.

View our latest analysis for Perrigo

As a result, there was no major change to the consensus price target of US$16.50, with the analysts implicitly confirming that the business looks to be performing in line with expectations, despite higher forecast losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Perrigo, with the most bullish analyst valuing it at US$20.00 and the most bearish at US$14.00 per share. As you can see, analysts are not all in agreement on the stock’s future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.1% by the end of 2026. This indicates a significant reduction from annual growth of 0.2% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 9.2% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining – Perrigo is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it’s tracking in line with expectations. Although our data does suggest that Perrigo’s revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$16.50, 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. We have forecasts for Perrigo going out to 2028, and you can see them free on our platform here.

You should always think about risks though. Case in point, we’ve spotted 1 warning sign for Perrigo you should be aware of.

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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.