CECO Environmental Corp. (NASDAQ:CECO) Just Reported And Analysts Have Been Lifting Their Price Targets

CECO Environmental Corp. (NASDAQ:CECO) shareholders are probably feeling a little disappointed, since its shares fell 2.7% to US$29.20 in the week after its latest quarterly results. CECO Environmental missed revenue estimates by 4.0%, coming in atUS$138m, although statutory earnings per share (EPS) of US$0.12 beat expectations, coming in 2.9% ahead of analyst estimates. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for CECO Environmental

Taking into account the latest results, the most recent consensus for CECO Environmental from six analysts is for revenues of US$604.5m in 2024. If met, it would imply a reasonable 6.6% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 69% to US$0.64. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$597.0m and earnings per share (EPS) of US$0.70 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

Althoughthe analysts have revised their earnings forecasts for next year, they've also lifted the consensus price target 10% to US$32.00, suggesting the revised estimates are not indicative of a weaker long-term future for the business. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values CECO Environmental at US$35.00 per share, while the most bearish prices it at US$26.00. 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 CECO Environmental's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of CECO Environmental'shistorical trends, as the 14% annualised revenue growth to the end of 2024 is roughly in line with the 12% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 6.6% annually. So although CECO Environmental is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for CECO Environmental going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 2 warning signs we've spotted with CECO Environmental .

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com