Oshkosh Corporation (NYSE:OSK) shares fell 3.7% to US$86.04 in the week since its latest first-quarter results. It looks like the results were a bit of a negative overall. While revenues of US$1.7b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 5.0% to hit US$1.10 per share. Following the result, 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. With this in mind, we’ve gathered the latest statutory forecasts to see what analysts are expecting for next year.
See our latest analysis for Oshkosh
Taking into account the latest results, the current consensus, from the 15 analysts covering Oshkosh, is for revenues of US$8.06b in 2020, which would reflect a noticeable 2.5% reduction in Oshkosh’s sales over the past 12 months. Statutory earnings per share are expected to shrink 2.4% to US$7.73 in the same period. Before this earnings report, analysts had been forecasting revenues of US$8.04b and earnings per share (EPS) of US$7.72 in 2020. 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.
There were no changes to revenue or earnings estimates or the price target of US$101, suggesting that the company has met expectations in its recent result. That’s not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Oshkosh, with the most bullish analyst valuing it at US$120 and the most bearish at US$81.00 per share. This shows there is still quite a bit of diversity in estimates, but analysts don’t appear to be totally split on the stock as though it might be a success or failure situation.
In addition, we can look to Oshkosh’s past performance and see whether business is expected to improve, and if the company is expected to perform better than wider market. We would highlight that sales are expected to reverse, with the forecast 2.5% revenue decline a notable change from historical growth of 7.1% over the last five years. Compare this with our data, which suggests that other companies in the same market are, in aggregate, expected to see their revenue grow 1.6% next year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining – analysts also expect Oshkosh to grow slower than the wider market.
The Bottom Line
The most obvious conclusion from these results is that there’s been no major change in the business’ prospects in recent times, with analysts holding earnings per share steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although analyst forecasts imply revenues will perform worse than the wider market. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Still, the long-term prospects of the business are much more relevant than next year’s earnings. We have estimates – from multiple Oshkosh analysts – going out to 2022, and you can see them free on our platform here.
You can also view our analysis of Oshkosh’s balance sheet, and whether we think Oshkosh is carrying too much debt, for free on our platform here.
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