Leggett & Platt, Incorporated Just Beat EPS By 7.3%: Here's What Analysts Think Will Happen Next

Shareholders will be ecstatic, with their stake up 32% over the past week following Leggett & Platt, Incorporated's (NYSE:LEG) latest quarterly results. Leggett & Platt reported US$1.0b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.22 beat expectations, being 7.3% higher than what the analysts expected. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Following the recent earnings report, the consensus from four analysts covering Leggett & Platt is for revenues of US$4.15b in 2025. This implies a perceptible 3.7% decline in revenue compared to the last 12 months. Leggett & Platt is also expected to turn profitable, with statutory earnings of US$1.05 per share. Before this earnings report, the analysts had been forecasting revenues of US$4.17b and earnings per share (EPS) of US$0.99 in 2025. So the consensus seems to have become somewhat more optimistic on Leggett & Platt's earnings potential following these results.

Check out our latest analysis for Leggett & Platt

The consensus price target rose 7.1% to US$10.00, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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 Leggett & Platt at US$11.00 per share, while the most bearish prices it at US$9.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Leggett & Platt is an easy business to forecast or the the analysts are all using similar assumptions.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 4.9% annualised decline to the end of 2025. That is a notable change from historical growth of 0.03% 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 4.4% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Leggett & Platt is expected to lag the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Leggett & Platt's earnings potential 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. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Leggett & Platt analysts - going out to 2027, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 3 warning signs for Leggett & Platt (1 is potentially serious!) that you need to be mindful 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.