Cactus, Inc. Just Missed Earnings - But Analysts Have Updated Their Models

There's been a notable change in appetite for Cactus, Inc. (NYSE:WHD) shares in the week since its second-quarter report, with the stock down 14% to US$39.69. It was not a great result overall. While revenues of US$274m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 19% to hit US$0.59 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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After the latest results, the consensus from Cactus' four analysts is for revenues of US$1.06b in 2025, which would reflect a measurable 5.4% decline in revenue compared to the last year of performance. Statutory earnings per share are forecast to shrink 8.0% to US$2.43 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.11b and earnings per share (EPS) of US$2.78 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Check out our latest analysis for Cactus

Despite the cuts to forecast earnings, there was no real change to the US$50.13 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Cactus analyst has a price target of US$56.00 per share, while the most pessimistic values it at US$39.00. 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.

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 11% annualised decline to the end of 2025. That is a notable change from historical growth of 27% 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 3.2% annually for the foreseeable future. It's pretty clear that Cactus' revenues are expected to perform substantially worse than 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 negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$50.13, with the latest estimates not enough to have an impact on their price targets.

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

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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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.