Matrix Service Company (NASDAQ:MTRX) Just Reported Earnings, And Analysts Cut Their Target Price

Matrix Service Company (NASDAQ:MTRX) just released its latest third-quarter report and things are not looking great. Revenues missed expectations somewhat, coming in at US$200m, but statutory earnings fell catastrophically short, with a loss of US$0.12 some 140% larger than what the analysts had predicted. 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.

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Taking into account the latest results, the consensus forecast from Matrix Service's dual analysts is for revenues of US$1.01b in 2026. This reflects a major 36% improvement in revenue compared to the last 12 months. Matrix Service is also expected to turn profitable, with statutory earnings of US$1.08 per share. In the lead-up to this report, the analysts had been modelling revenues of US$1.05b and earnings per share (EPS) of US$1.04 in 2026. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analysts are now more bullish on the company's earnings power.

View our latest analysis for Matrix Service

The analysts have cut their price target 5.6% to US$17.00per share, suggesting that the declining revenue was a more crucial indicator than the expected improvement in earnings.

Of course, another way to look at these forecasts is to place them into context against the industry itself. For example, we noticed that Matrix Service's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 28% growth to the end of 2026 on an annualised basis. That is well above its historical decline of 6.4% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue grow 7.7% per year. Not only are Matrix Service's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Matrix Service's earnings potential next year. They also downgraded Matrix Service's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. Even so, long term profitability is more important for the value creation process. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on Matrix Service. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Matrix Service going out as far as 2027, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.