Holley Inc. Just Missed EPS By 40%: Here's What Analysts Think Will Happen Next

Holley Inc. (NYSE:HLLY) shareholders are probably feeling a little disappointed, since its shares fell 2.2% to US$3.99 in the week after its latest quarterly results. Results overall were not great, with earnings of US$0.03 per share falling drastically short of analyst expectations. Meanwhile revenues hit US$159m and were slightly better than forecasts. 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 Holley

Following last week's earnings report, Holley's ten analysts are forecasting 2024 revenues to be US$657.5m, approximately in line with the last 12 months. Per-share earnings are expected to bounce 55% to US$0.24. Before this earnings report, the analysts had been forecasting revenues of US$661.5m and earnings per share (EPS) of US$0.31 in 2024. 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 average price target fell 7.4% to US$6.92, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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 Holley at US$12.00 per share, while the most bearish prices it at US$5.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Holley's rate of growth is expected to accelerate meaningfully, with the forecast 2.3% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 1.5% p.a. over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 11% per year. So it's clear that despite the acceleration in growth, Holley is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Holley. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Holley's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Holley going out to 2026, and you can see them free on our platform here..

Even so, be aware that Holley is showing 2 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

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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.