Matson, Inc. (NYSE:MATX) Analysts Just Slashed This Year's Estimates

The latest analyst coverage could presage a bad day for Matson, Inc. (NYSE:MATX), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Revenue and earnings per share (EPS) forecasts were both revised downwards, with the analysts seeing grey clouds on the horizon. Bidders are definitely seeing a different story, with the stock price of US$118 reflecting a 26% rise in the past week. It will be interesting to see if the downgrade has an impact on buying demand for the company's shares.

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Following the latest downgrade, the current consensus, from the two analysts covering Matson, is for revenues of US$3.1b in 2025, which would reflect a definite 12% reduction in Matson's sales over the past 12 months. Statutory earnings per share are supposed to tumble 45% to US$8.57 in the same period. Previously, the analysts had been modelling revenues of US$3.4b and earnings per share (EPS) of US$11.24 in 2025. It looks like analyst sentiment has declined substantially, with a measurable cut to revenue estimates and a large cut to earnings per share numbers as well.

Check out our latest analysis for Matson

Despite the cuts to forecast earnings, there was no real change to the US$143 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Matson's past performance and to peers in the same industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 16% by the end of 2025. This indicates a significant reduction from annual growth of 6.0% over the last five years. Yet aggregate analyst estimates for other companies in the industry suggest that industry revenues are forecast to decline 0.9% per year. So it's pretty clear that Matson's revenues are expected to shrink faster than the wider industry.

The Bottom Line

The most important thing to take away is that analysts cut their earnings per share estimates, expecting a clear decline in business conditions. Unfortunately they also downgraded their revenue estimates, and our aggregation of analyst estimates suggests that Matson revenue is expected to perform worse than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on Matson after the downgrade.

That said, the analysts might have good reason to be negative on Matson, given recent substantial insider selling. Learn more, and discover the 1 other warning sign we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies backed by insiders.

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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.