Wolverine World Wide, Inc. (NYSE:WWW) Analysts Are Pretty Bullish On The Stock After Recent Results

The investors in Wolverine World Wide, Inc.'s (NYSE:WWW) will be rubbing their hands together with glee today, after the share price leapt 25% to US$13.49 in the week following its quarterly results. The results don't look great, especially considering that statutory losses grew 423% toUS$0.19 per share. Revenues of US$395m did beat expectations by 9.2%, but it looks like a bit of a cold comfort. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Wolverine World Wide after the latest results.

Check out our latest analysis for Wolverine World Wide

Following the recent earnings report, the consensus from eight analysts covering Wolverine World Wide is for revenues of US$1.72b in 2024. This implies a considerable 16% decline in revenue compared to the last 12 months. Wolverine World Wide is also expected to turn profitable, with statutory earnings of US$0.62 per share. Before this earnings report, the analysts had been forecasting revenues of US$1.71b and earnings per share (EPS) of US$0.74 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

Despite cutting their earnings forecasts,the analysts have lifted their price target 39% to US$13.71, suggesting that these impacts are not expected to weigh on the stock's value in the long term. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Wolverine World Wide analyst has a price target of US$16.00 per share, while the most pessimistic values it at US$11.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Wolverine World Wide's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 20% by the end of 2024. This indicates a significant reduction from annual growth of 3.4% 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 6.0% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Wolverine World Wide is expected to lag 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. 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 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 estimates - from multiple Wolverine World Wide analysts - going out to 2026, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Wolverine World Wide (1 shouldn't be ignored!) 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.