US$147 - That's What Analysts Think Armstrong World Industries, Inc. (NYSE:AWI) Is Worth After These Results

Investors in Armstrong World Industries, Inc. (NYSE:AWI) had a good week, as its shares rose 2.5% to close at US$140 following the release of its quarterly results. Armstrong World Industries reported in line with analyst predictions, delivering revenues of US$387m and statutory earnings per share of US$1.75, suggesting the business is executing well and in line with its plan. 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.

See our latest analysis for Armstrong World Industries

Taking into account the latest results, the consensus forecast from Armstrong World Industries' eight analysts is for revenues of US$1.53b in 2025. This reflects a decent 9.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to ascend 18% to US$6.76. Before this earnings report, the analysts had been forecasting revenues of US$1.52b and earnings per share (EPS) of US$6.65 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 5.7% to US$147despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Armstrong World Industries' earnings by assigning a price premium. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Armstrong World Industries, with the most bullish analyst valuing it at US$163 and the most bearish at US$122 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

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. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 7.7% growth on an annualised basis. That is in line with its 7.6% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 4.5% annually. So although Armstrong World Industries is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Armstrong World Industries analysts - going out to 2026, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Armstrong World Industries you should know about.

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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.