Owens Corning Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

It's been a good week for Owens Corning (NYSE:OC) shareholders, because the company has just released its latest first-quarter results, and the shares gained 5.2% to US$169. Revenues were US$2.3b, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$3.40 were also better than expected, beating analyst predictions by 10%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Owens Corning after the latest results.

Check out our latest analysis for Owens Corning

Taking into account the latest results, Owens Corning's 14 analysts currently expect revenues in 2024 to be US$9.69b, approximately in line with the last 12 months. Statutory earnings per share are predicted to grow 17% to US$14.98. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$9.63b and earnings per share (EPS) of US$13.90 in 2024. So the consensus seems to have become somewhat more optimistic on Owens Corning's earnings potential following these results.

The consensus price target was unchanged at US$178, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Owens Corning at US$197 per share, while the most bearish prices it at US$160. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Owens Corning 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 Owens Corning's revenue growth is expected to slow, with the forecast 0.6% annualised growth rate until the end of 2024 being well below the historical 8.7% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.4% annually. Factoring in the forecast slowdown in growth, it seems obvious that Owens Corning 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 Owens Corning's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$178, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Owens Corning. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Owens Corning 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 Owens Corning 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.