ePlus inc. (NASDAQ:PLUS) Analysts Are Pretty Bullish On The Stock After Recent Results

The first-quarter results for ePlus inc. (NASDAQ:PLUS) were released last week, making it a good time to revisit its performance. It looks like the results were a bit of a negative overall. While revenues of US$545m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.9% to hit US$1.02 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for ePlus

After the latest results, the three analysts covering ePlus are now predicting revenues of US$2.31b in 2025. If met, this would reflect a modest 5.0% improvement in revenue compared to the last 12 months. Per-share earnings are expected to ascend 14% to US$4.67. Before this earnings report, the analysts had been forecasting revenues of US$2.31b and earnings per share (EPS) of US$4.76 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 6.7% to US$96.00. It looks as though they previously had some doubts over whether the business would live up to their expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on ePlus, with the most bullish analyst valuing it at US$102 and the most bearish at US$90.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. It's pretty clear that there is an expectation that ePlus' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 6.8% growth on an annualised basis. This is compared to a historical growth rate of 9.8% over the past five years. Compare this to the 181 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 7.4% per year. So it's pretty clear that, while ePlus' revenue growth is expected to slow, it's expected to grow roughly in line with the 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on ePlus. Long-term earnings power is much more important than next year's profits. We have forecasts for ePlus going out to 2026, 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.