Earnings Miss: L.B. Foster Company Missed EPS By 35% And Analysts Are Revising Their Forecasts

It's shaping up to be a tough period for L.B. Foster Company (NASDAQ:FSTR), which a week ago released some disappointing third-quarter results that could have a notable impact on how the market views the stock. Unfortunately, L.B. Foster delivered a serious earnings miss. Revenues of US$138m were 10% below expectations, and statutory earnings per share of US$0.40 missed estimates by 35%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, the most recent consensus for L.B. Foster from twin analysts is for revenues of US$552.8m in 2026. If met, it would imply a meaningful 8.9% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 272% to US$1.75. In the lead-up to this report, the analysts had been modelling revenues of US$562.1m and earnings per share (EPS) of US$1.88 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

View our latest analysis for L.B. Foster

It might be a surprise to learn that the consensus price target was broadly unchanged at US$29.00, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that L.B. Foster's rate of growth is expected to accelerate meaningfully, with the forecast 7.0% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 1.1% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that L.B. Foster is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

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 analyst estimates for L.B. Foster going out as far as 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for L.B. Foster that we have uncovered.

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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.