Own Pilbara Minerals shares? Here's your first-half results preview

The lithium giant is expected to report a sharp decline in profits.

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Pilbara Minerals Ltd (ASX: PLS) shares will be in focus next week.

That's because the lithium miner is scheduled to release its eagerly anticipated half-year results.

Investors will no doubt be keen to see how much the crash in lithium prices has impacted the miner's profitability.

Let's now see what the market is expecting from the company when it reports its earnings on Thursday 22 February.

Pilbara Minerals half-year results preview

According to a note out of Goldman Sachs, its analysts are expecting a result well short of consensus estimates.

Its analysts are forecasting revenue of $774 million for the half, which will be down 64% year on year. This compares to the consensus estimate of $926 million.

It is a similar story for earnings, with Goldman pencilling in underlying EBITDA of $469 million. This represents a 74% year on year decline and is meaningfully below the consensus estimate of $597 million.

On the bottom line, the broker expects underlying net profit after tax to fall 74% to $324 million. As a comparison, the consensus estimate is for a half-year profit of $421 million.

Finally, Goldman believes that there will be no interim dividend from Pilbara Minerals next week. Though, the market remains a little more hopeful and is expecting a modest 5.4 cents per share payout to be announced.

Are Pilbara Minerals shares a buy?

As you might have guessed from its estimates, Goldman is feeling quite bearish about the company at present.

Its analysts currently have a sell rating and $2.95 price target on Pilbara Minerals' shares, which implies potential downside of almost 15% for investors over the next 12 months.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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