It's been a good week for nVent Electric plc (NYSE:NVT) shareholders, because the company has just released its latest yearly results, and the shares gained 2.9% to US$64.29. Revenues were US$3.3b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$3.37, an impressive 32% ahead of estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on nVent Electric after the latest results.
Taking into account the latest results, the most recent consensus for nVent Electric from ten analysts is for revenues of US$3.57b in 2024. If met, it would imply a solid 9.3% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to descend 19% to US$2.77 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$3.57b and earnings per share (EPS) of US$2.82 in 2024. 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 6.8% to US$69.49. It looks as though they previously had some doubts over whether the business would live up to their expectations. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values nVent Electric at US$74.00 per share, while the most bearish prices it at US$64.40. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 9.3% growth on an annualised basis. That is in line with its 9.2% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 7.9% annually. It's clear that while nVent Electric's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.
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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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 nVent Electric. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple nVent Electric analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for nVent Electric (1 is a bit concerning!) that you need to take into consideration.
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