ITT Inc. (NYSE:ITT) just released its quarterly report and things are looking bullish. The company beat expectations with revenues of US$911m arriving 3.1% ahead of forecasts. Statutory earnings per share (EPS) were US$1.34, 5.3% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Following the latest results, ITT's eleven analysts are now forecasting revenues of US$3.65b in 2024. This would be a satisfactory 7.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to expand 12% to US$5.74. In the lead-up to this report, the analysts had been modelling revenues of US$3.63b and earnings per share (EPS) of US$5.49 in 2024. So the consensus seems to have become somewhat more optimistic on ITT's earnings potential following these results.
There's been no major changes to the consensus price target of US$144, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on ITT, with the most bullish analyst valuing it at US$161 and the most bearish at US$125 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company 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. The analysts are definitely expecting ITT's growth to accelerate, with the forecast 10% annualised growth to the end of 2024 ranking favourably alongside historical growth of 4.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.6% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that ITT is expected to grow much faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around ITT's earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$144, with the latest estimates not enough to have an impact on their price targets.
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 ITT going out to 2026, and you can see them free on our platform here.
It might also be worth considering whether ITT's debt load is appropriate, using our debt analysis tools on the Simply Wall St 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.