Yahoo Finance Results: Arhaus, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
Arhaus, Inc. (NASDAQ:ARHS) just released its first-quarter report and things are looking bullish. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 10% higher than the analysts had forecast, at US$295m, while EPS were US$0.11 beating analyst models by 633%. 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 Arhaus after the latest results.
Check out our latest analysis for Arhaus
After the latest results, the ten analysts covering Arhaus are now predicting revenues of US$1.36b in 2024. If met, this would reflect a modest 6.2% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 3.4% to US$0.73 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$1.35b and earnings per share (EPS) of US$0.73 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$18.10. 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. The most optimistic Arhaus analyst has a price target of US$21.00 per share, while the most pessimistic values it at US$16.00. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Arhaus' past performance and to peers in the same industry. We would highlight that Arhaus' revenue growth is expected to slow, with the forecast 8.4% annualised growth rate until the end of 2024 being well below the historical 26% p.a. growth over the last three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 4.9% per year. Even after the forecast slowdown in growth, it seems obvious that Arhaus is also expected to grow faster than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. 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$18.10, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Arhaus. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Arhaus analysts - going out to 2026, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 2 warning signs for Arhaus you should be aware of, and 1 of them shouldn't be ignored.
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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.
