Yahoo Finance Enhabit, Inc. (NYSE:EHAB) Just Reported Annual Earnings: Have Analysts Changed Their Mind On The Stock?
It's been a pretty great week for Enhabit, Inc. (NYSE:EHAB) shareholders, with its shares surging 17% to US$10.34 in the week since its latest annual results. The statutory results were mixed overall, with revenues of US$1.0b in line with analyst forecasts, but losses of US$1.61 per share, some 10.0% larger than the analysts were predicting. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
View our latest analysis for Enhabit
Taking into account the latest results, the current consensus from Enhabit's nine analysts is for revenues of US$1.08b in 2024. This would reflect an okay 3.7% increase on its revenue over the past 12 months. Enhabit is also expected to turn profitable, with statutory earnings of US$0.21 per share. Before this earnings report, the analysts had been forecasting revenues of US$1.07b and earnings per share (EPS) of US$0.19 in 2024. Although the revenue estimates have not really changed, we can see there's been a substantial gain in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target was unchanged at US$10.57, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Enhabit, with the most bullish analyst valuing it at US$14.00 and the most bearish at US$8.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
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. For example, we noticed that Enhabit's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 3.7% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 1.7% a year over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 6.7% per year. Although Enhabit's revenues are expected to improve, it seems that the analysts are still bearish on the business, forecasting it to grow slower than the broader industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Enhabit's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Enhabit's revenue is expected to perform worse 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Enhabit going out to 2026, and you can see them free on our platform here.
You can also see whether Enhabit is carrying too much debt, and whether its balance sheet is healthy, for free 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.
