MYR Group Inc. Just Beat EPS By 15%: Here's What Analysts Think Will Happen Next

MYR Group Inc. (NASDAQ:MYRG) just released its second-quarter report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 7.7% to hit US$900m. MYR Group reported statutory earnings per share (EPS) US$1.70, which was a notable 15% above what the analysts had forecast. 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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After the latest results, the four analysts covering MYR Group are now predicting revenues of US$3.57b in 2025. If met, this would reflect an okay 3.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 47% to US$7.23. Before this earnings report, the analysts had been forecasting revenues of US$3.51b and earnings per share (EPS) of US$6.53 in 2025. Although the revenue estimates have not really changed, we can see there's been a nice gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.

See our latest analysis for MYR Group

The consensus price target was unchanged at US$201, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values MYR Group at US$220 per share, while the most bearish prices it at US$168. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting MYR Group is an easy business to forecast or the the analysts are all using similar assumptions.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that MYR Group's revenue growth is expected to slow, with the forecast 6.7% annualised growth rate until the end of 2025 being well below the historical 11% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 8.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that MYR Group is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around MYR Group's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that MYR Group'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.

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

You can also see whether MYR Group is carrying too much debt, and whether its balance sheet is healthy, for free 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.