Ecovyst Inc. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Last week, you might have seen that Ecovyst Inc. (NYSE:ECVT) released its full-year result to the market. The early response was not positive, with shares down 8.2% to US$9.12 in the past week. Revenues were in line with forecasts, at US$691m, although statutory earnings per share came in 17% below what the analysts expected, at US$0.60 per share. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Ecovyst

Following the latest results, Ecovyst's six analysts are now forecasting revenues of US$760.7m in 2024. This would be a solid 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 33% to US$0.81. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$731.4m and earnings per share (EPS) of US$0.89 in 2024. So it's pretty clear consensus is mixed on Ecovyst after the latest results; whilethe analysts lifted revenue numbers, they also administered a small dip in per-share earnings expectations.

There's been no major changes to the price target of US$13.50, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Ecovyst, with the most bullish analyst valuing it at US$18.00 and the most bearish at US$10.50 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Ecovyst's past performance and to peers in the same industry. For example, we noticed that Ecovyst's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 10% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 15% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 4.4% annually. So it looks like Ecovyst is expected to grow faster than its competitors, at least for a while.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Ecovyst. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Ecovyst going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Ecovyst that you need to be mindful 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.