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

As you might know, Montrose Environmental Group, Inc. (NYSE:MEG) just kicked off its latest third-quarter results with some very strong numbers. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 12% higher than the analysts had forecast, at US$225m, while EPS were US$0.21 beating analyst models by 320%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Montrose Environmental Group after the latest results.

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Taking into account the latest results, the most recent consensus for Montrose Environmental Group from five analysts is for revenues of US$847.7m in 2026. If met, it would imply a modest 2.6% increase on its revenue over the past 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 98% to US$0.015. Before this latest report, the consensus had been expecting revenues of US$842.6m and US$0.03 per share in losses. While the revenue estimates were largely unchanged, sentiment seems to have improved, with the analysts upgrading their numbers and making a very promising decrease in losses per share in particular.

Check out our latest analysis for Montrose Environmental Group

The average price target held steady at US$33.33, seeming to indicate that business is performing in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Montrose Environmental Group at US$36.00 per share, while the most bearish prices it at US$31.00. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's pretty clear that there is an expectation that Montrose Environmental Group's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 2.1% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.9% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Montrose Environmental Group.

The Bottom Line

The most obvious conclusion is that the analysts made no changes to their forecasts for a loss 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. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Montrose Environmental Group going out to 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Montrose Environmental Group that we have uncovered.

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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.