It's been a sad week for Redwire Corporation (NYSE:RDW), who've watched their investment drop 14% to US$5.39 in the week since the company reported its second-quarter result. Results overall weren't great; even though revenues of US$78m beat expectations by 14%, statutory losses ballooned to US$0.42 per share, substantially worse than the analysts had expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Redwire after the latest results.

See our latest analysis for Redwire

Taking into account the latest results, the current consensus from Redwire's five analysts is for revenues of US$304.4m in 2024. This would reflect an okay 4.2% increase on its revenue over the past 12 months. Losses are supposed to decline, shrinking 12% from last year to US$0.85. Before this latest report, the consensus had been expecting revenues of US$304.3m and US$0.46 per share in losses. So it's pretty clear the analysts have mixed opinions on Redwire even after this update; although they reconfirmed their revenue numbers, it came at the cost of a very substantial increase in per-share losses.

The consensus price target held steady at US$8.25, seemingly implying that the higher forecast losses are not expected to have a long term impact on the company's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Redwire at US$10.00 per share, while the most bearish prices it at US$6.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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 highlight that Redwire's revenue growth is expected to slow, with the forecast 8.7% annualised growth rate until the end of 2024 being well below the historical 33% p.a. growth over the last three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.7% annually. So it's pretty clear that, while Redwire's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Redwire. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$8.25, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Redwire going out to 2026, and you can see them free on our platform here.

Even so, be aware that Redwire is showing 2 warning signs in our investment analysis , you should know about...

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.