Tri Pointe Homes, Inc. (NYSE:TPH) defied analyst predictions to release its quarterly results, which were ahead of market expectations. The company beat forecasts, with revenue of US$926m, some 7.2% above estimates, and statutory earnings per share (EPS) coming in at US$1.03, 41% ahead of expectations. 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 thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the current consensus from Tri Pointe Homes' six analysts is for revenues of US$4.27b in 2024. This would reflect a meaningful 10% increase on its revenue over the past 12 months. Per-share earnings are expected to grow 18% to US$4.57. In the lead-up to this report, the analysts had been modelling revenues of US$4.11b and earnings per share (EPS) of US$3.88 in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a nice gain to earnings per share in particular.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 10% to US$43.35per share. 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. There are some variant perceptions on Tri Pointe Homes, with the most bullish analyst valuing it at US$48.00 and the most bearish at US$40.10 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Tri Pointe Homes' rate of growth is expected to accelerate meaningfully, with the forecast 14% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.7% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 5.1% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Tri Pointe Homes to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Tri Pointe Homes following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider 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 said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Tri Pointe Homes analysts - going out to 2026, and you can see them free on our platform here.
It might also be worth considering whether Tri Pointe Homes' debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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