HireQuest, Inc. Just Beat EPS By 20%: Here's What Analysts Think Will Happen Next

Last week, you might have seen that HireQuest, Inc. (NASDAQ:HQI) released its first-quarter result to the market. The early response was not positive, with shares down 4.6% to US$11.90 in the past week. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$8.4m, statutory earnings beat expectations by a notable 20%, coming in at US$0.12 per share. 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. 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 HireQuest

Taking into account the latest results, the current consensus, from the two analysts covering HireQuest, is for revenues of US$35.5m in 2024. This implies a noticeable 2.6% reduction in HireQuest's revenue over the past 12 months. Statutory earnings per share are predicted to bounce 44% to US$0.60. Before this earnings report, the analysts had been forecasting revenues of US$37.5m and earnings per share (EPS) of US$0.59 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The average price target was reduced 9.5% to US$19.00, with the lower revenue forecasts indicating negative sentiment towards HireQuest, even though earnings forecasts were unchanged.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 3.4% annualised decline to the end of 2024. That is a notable change from historical growth of 25% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.7% annually for the foreseeable future. It's pretty clear that HireQuest's revenues are expected to perform substantially worse 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. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for HireQuest 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.