Analysts Are Updating Their Air Products and Chemicals, Inc. (NYSE:APD) Estimates After Its Third-Quarter Results

Investors in Air Products and Chemicals, Inc. (NYSE:APD) had a good week, as its shares rose 8.0% to close at US$282 following the release of its third-quarter results. The result was positive overall - although revenues of US$3.0b were in line with what the analysts predicted, Air Products and Chemicals surprised by delivering a statutory profit of US$3.13 per share, modestly greater than expected. 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. 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 Air Products and Chemicals

Taking into account the latest results, the most recent consensus for Air Products and Chemicals from 20 analysts is for revenues of US$13.0b in 2025. If met, it would imply an okay 7.2% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 16% to US$13.37. Before this earnings report, the analysts had been forecasting revenues of US$13.2b and earnings per share (EPS) of US$13.53 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

There were no changes to revenue or earnings estimates or the price target of US$295, suggesting that the company has met expectations in its recent result. 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 Air Products and Chemicals analyst has a price target of US$355 per share, while the most pessimistic values it at US$210. 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.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Air Products and Chemicals' revenue growth is expected to slow, with the forecast 5.8% annualised growth rate until the end of 2025 being well below the historical 9.2% p.a. growth over the last five years. Compare this to the 125 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.7% per year. Factoring in the forecast slowdown in growth, it looks like Air Products and Chemicals is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$295, with the latest estimates not enough to have an impact on their price targets.

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 Air Products and Chemicals analysts - going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Air Products and Chemicals that you should be aware 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com