Earnings Beat: KBR, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

KBR, Inc. (NYSE:KBR) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Results were good overall, with revenues beating analyst predictions by 2.1% to hit US$1.8b. Statutory earnings per share (EPS) came in at US$0.69, some 7.3% above whatthe analysts had expected. 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. 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 KBR

After the latest results, the eleven analysts covering KBR are now predicting revenues of US$7.56b in 2024. If met, this would reflect a credible 6.9% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with KBR forecast to report a statutory profit of US$3.03 per share. Before this earnings report, the analysts had been forecasting revenues of US$7.53b and earnings per share (EPS) of US$3.03 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.

There were no changes to revenue or earnings estimates or the price target of US$74.91, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values KBR at US$90.00 per share, while the most bearish prices it at US$65.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

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. It's clear from the latest estimates that KBR's rate of growth is expected to accelerate meaningfully, with the forecast 9.3% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.3% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.6% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that KBR is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. 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$74.91, 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 KBR. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple KBR analysts - going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for KBR 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.