Results: AMN Healthcare Services, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts

Last week, you might have seen that AMN Healthcare Services, Inc. (NYSE:AMN) released its quarterly result to the market. The early response was not positive, with shares down 8.7% to US$54.71 in the past week. Revenues were US$821m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.45 were also better than expected, beating analyst predictions by 13%. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for AMN Healthcare Services

Taking into account the latest results, the nine analysts covering AMN Healthcare Services provided consensus estimates of US$2.98b revenue in 2024, which would reflect a not inconsiderable 14% decline over the past 12 months. Statutory earnings per share are expected to plunge 65% to US$1.33 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$3.17b and earnings per share (EPS) of US$1.65 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

The consensus price target fell 5.8% to US$70.75, with the weaker earnings outlook clearly leading valuation estimates. 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. There are some variant perceptions on AMN Healthcare Services, with the most bullish analyst valuing it at US$95.00 and the most bearish at US$60.00 per share. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the AMN Healthcare Services' past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 19% annualised decline to the end of 2024. That is a notable change from historical growth of 17% 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 6.6% annually for the foreseeable future. It's pretty clear that AMN Healthcare Services' 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. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that in mind, we wouldn't be too quick to come to a conclusion on AMN Healthcare Services. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple AMN Healthcare Services analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that AMN Healthcare Services is showing 2 warning signs in our investment analysis , you should know about...

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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.