Old Dominion Freight Line, Inc. (NASDAQ:ODFL) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

There's been a notable change in appetite for Old Dominion Freight Line, Inc. (NASDAQ:ODFL) shares in the week since its first-quarter report, with the stock down 14% to US$182. It was a credible result overall, with revenues of US$1.5b and statutory earnings per share of US$1.34 both in line with analyst estimates, showing that Old Dominion Freight Line is executing in line with expectations. 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 Old Dominion Freight Line

After the latest results, the 17 analysts covering Old Dominion Freight Line are now predicting revenues of US$6.21b in 2024. If met, this would reflect a satisfactory 5.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 6.2% to US$6.08. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$6.32b and earnings per share (EPS) of US$6.40 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$207, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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 Old Dominion Freight Line, with the most bullish analyst valuing it at US$245 and the most bearish at US$152 per share. 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.

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. It's pretty clear that there is an expectation that Old Dominion Freight Line's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 7.4% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.9% annually. Factoring in the forecast slowdown in growth, it looks like Old Dominion Freight Line is forecast to grow at about the same rate as 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 Old Dominion Freight Line. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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. At Simply Wall St, we have a full range of analyst estimates for Old Dominion Freight Line going out to 2026, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Old Dominion Freight Line , and understanding this should be part of your investment process.

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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.