Earnings Update: Here's Why Analysts Just Lifted Their Trimble Inc. (NASDAQ:TRMB) Price Target To US$64.49

Shareholders of Trimble Inc. (NASDAQ:TRMB) will be pleased this week, given that the stock price is up 12% to US$58.21 following its latest full-year results. Revenues of US$3.8b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$1.25, missing estimates by 2.2%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Trimble

Taking into account the latest results, the current consensus, from the eleven analysts covering Trimble, is for revenues of US$3.64b in 2024. This implies a discernible 4.2% reduction in Trimble's revenue over the past 12 months. Per-share earnings are expected to shoot up 25% to US$1.57. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$3.84b and earnings per share (EPS) of US$1.60 in 2024. The consensus seems maybe a little more pessimistic, trimming their revenue forecasts after the latest results even though there was no change to its EPS estimates.

The consensus price target rose 8.6% to US$64.49, with the analysts apparently satisfied with the business performance despite lower revenue forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Trimble, with the most bullish analyst valuing it at US$68.00 and the most bearish at US$57.00 per share. This is a very narrow spread of estimates, implying either that Trimble is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that revenue is expected to reverse, with a forecast 4.2% annualised decline to the end of 2024. That is a notable change from historical growth of 4.3% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.2% per year. It's pretty clear that Trimble's revenues are expected to perform substantially worse than 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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Trimble 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 Trimble (1 can't be ignored) 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.