Yahoo Finance Chemed Corporation Just Missed EPS By 14%: Here's What Analysts Think Will Happen Next
Chemed Corporation (NYSE:CHE) shareholders are probably feeling a little disappointed, since its shares fell 4.0% to US$573 in the week after its latest first-quarter results. It was not a great result overall. While revenues of US$589m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 14% to hit US$4.24 per share. 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.
See our latest analysis for Chemed
Taking into account the latest results, the most recent consensus for Chemed from four analysts is for revenues of US$2.43b in 2024. If met, it would imply a modest 6.1% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 12% to US$20.94. In the lead-up to this report, the analysts had been modelling revenues of US$2.42b and earnings per share (EPS) of US$21.19 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The consensus price target rose 10% to US$689despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Chemed's earnings by assigning a price premium. 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 Chemed, with the most bullish analyst valuing it at US$712 and the most bearish at US$650 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Chemed's rate of growth is expected to accelerate meaningfully, with the forecast 8.2% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 3.8% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 6.7% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Chemed is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Chemed going out to 2026, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for Chemed (of which 1 doesn't sit too well with us!) you should know about.
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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.
