Air New Zealand Limited Just Missed EPS By 10%: Here's What Analysts Think Will Happen Next

Last week saw the newest full-year earnings release from Air New Zealand Limited (NZSE:AIR), an important milestone in the company's journey to build a stronger business. It was not a great result overall. While revenues of NZ$6.8b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 10% to hit NZ$0.043 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Air New Zealand

Taking into account the latest results, Air New Zealand's five analysts currently expect revenues in 2025 to be NZ$6.67b, approximately in line with the last 12 months. Statutory earnings per share are forecast to crater 63% to NZ$0.016 in the same period. Before this earnings report, the analysts had been forecasting revenues of NZ$6.58b and earnings per share (EPS) of NZ$0.029 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.

The consensus price target held steady at NZ$0.62, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. Currently, the most bullish analyst values Air New Zealand at NZ$0.80 per share, while the most bearish prices it at NZ$0.48. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Air New Zealand's past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 1.2% annualised decline to the end of 2025. That is a notable change from historical growth of 6.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Air New Zealand is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Air New Zealand. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Air New Zealand's revenue is expected to perform worse than the wider industry. 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.

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 Air New Zealand going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with Air New Zealand .

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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.