Results: nVent Electric plc Beat Earnings Expectations And Analysts Now Have New Forecasts

It's been a good week for nVent Electric plc (NYSE:NVT) shareholders, because the company has just released its latest annual results, and the shares gained 2.9% to US$64.29. It looks like a credible result overall - although revenues of US$3.3b were what the analysts expected, nVent Electric surprised by delivering a (statutory) profit of US$3.37 per share, an impressive 32% above what was forecast. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for nVent Electric

Taking into account the latest results, the consensus forecast from nVent Electric's ten analysts is for revenues of US$3.57b in 2024. This reflects a notable 9.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to descend 19% to US$2.77 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$3.57b and earnings per share (EPS) of US$2.82 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 6.8% to US$69.49. It looks as though they previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values nVent Electric at US$74.00 per share, while the most bearish prices it at US$64.40. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the nVent Electric's past performance and to peers in the same industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 9.3% growth on an annualised basis. That is in line with its 9.2% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 7.9% per year. So although nVent Electric is expected to maintain its revenue growth rate, it's only growing at about the rate of 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

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 forecasts for nVent Electric going out to 2026, and you can see them free on our platform here.

Even so, be aware that nVent Electric is showing 2 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

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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.