Resideo Technologies, Inc. Just Missed Earnings - But Analysts Have Updated Their Models

Shareholders will be ecstatic, with their stake up 20% over the past week following Resideo Technologies, Inc.'s (NYSE:REZI) latest quarterly results. Statutory earnings per share fell badly short of expectations, coming in at US$0.07, some 85% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at US$1.8b. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Resideo Technologies

Taking into account the latest results, the most recent consensus for Resideo Technologies from four analysts is for revenues of US$7.33b in 2025. If met, it would imply a decent 14% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 93% to US$2.12. Before this earnings report, the analysts had been forecasting revenues of US$7.19b and earnings per share (EPS) of US$2.08 in 2025. So the consensus seems to have become somewhat more optimistic on Resideo Technologies' earnings potential following these results.

The consensus price target was unchanged at US$26.00, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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. The most optimistic Resideo Technologies analyst has a price target of US$27.00 per share, while the most pessimistic values it at US$25.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company 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 Resideo Technologies' past performance and to peers in the same industry. The analysts are definitely expecting Resideo Technologies' growth to accelerate, with the forecast 11% annualised growth to the end of 2025 ranking favourably alongside historical growth of 6.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.3% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Resideo Technologies is expected to grow much faster than its industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Resideo Technologies following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$26.00, with the latest estimates not enough to have an impact on their price targets.

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. At Simply Wall St, we have a full range of analyst estimates for Resideo Technologies going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Resideo Technologies that you should be aware of.

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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.