Yahoo Finance Results: Array Technologies, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
Array Technologies, Inc. (NASDAQ:ARRY) just released its latest quarterly results and things are looking bullish. The company beat forecasts, with revenue of US$256m, some 9.2% above estimates, and statutory earnings per share (EPS) coming in at US$0.08, 246% ahead of expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Array Technologies
After the latest results, the 25 analysts covering Array Technologies are now predicting revenues of US$1.13b in 2024. If met, this would reflect a reasonable 2.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 233% to US$0.36. Before this earnings report, the analysts had been forecasting revenues of US$1.32b and earnings per share (EPS) of US$0.66 in 2024. Indeed, we can see that the analysts are a lot more bearish about Array Technologies' prospects following the latest results, administering a real cut to revenue estimates and slashing their EPS estimates to boot.
The consensus price target fell 19% to US$14.41, with the weaker earnings outlook clearly leading valuation estimates. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Array Technologies, with the most bullish analyst valuing it at US$23.00 and the most bearish at US$8.00 per share. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Array Technologies' past performance and to peers in the same industry. We would highlight that Array Technologies' revenue growth is expected to slow, with the forecast 5.2% annualised growth rate until the end of 2024 being well below the historical 19% 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 8.0% per year. Factoring in the forecast slowdown in growth, it seems obvious that Array Technologies is also expected to grow slower than other industry participants.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Array Technologies. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
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 Array Technologies going out to 2026, and you can see them free on our platform here.
That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Array Technologies , and understanding them should be part of your investment process.
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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.
