Envista Holdings Corporation Just Missed Earnings - But Analysts Have Updated Their Models

Last week, you might have seen that Envista Holdings Corporation (NYSE:NVST) released its first-quarter result to the market. The early response was not positive, with shares down 6.8% to US$19.00 in the past week. Statutory earnings per share fell badly short of expectations, coming in at US$0.14, some 40% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at US$624m. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Envista Holdings

Taking into account the latest results, Envista Holdings' 13 analysts currently expect revenues in 2024 to be US$2.57b, approximately in line with the last 12 months. Envista Holdings is also expected to turn profitable, with statutory earnings of US$0.84 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.60b and earnings per share (EPS) of US$1.12 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 large cut to EPS estimates.

The average price target fell 16% to US$20.50, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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. Currently, the most bullish analyst values Envista Holdings at US$25.00 per share, while the most bearish prices it at US$17.50. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Envista Holdings shareholders.

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. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 0.5% growth on an annualised basis. That is in line with its 0.5% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 8.1% annually. So although Envista Holdings is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Envista Holdings. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Envista Holdings' revenue is expected to perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Envista Holdings' future valuation.

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 Envista Holdings analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with Envista Holdings .

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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.