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It's been a good week for CTS Corporation (NYSE:CTS) shareholders, because the company has just released its latest third-quarter results, and the shares gained 3.6% to US$49.49. It looks like a credible result overall - although revenues of US$132m were in line with what the analyst predicted, CTS surprised by delivering a statutory profit of US$0.61 per share, a notable 13% above expectations. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.
See our latest analysis for CTS
Taking into account the latest results, the consensus forecast from CTS' solitary analyst is for revenues of US$551.6m in 2025. This reflects a credible 7.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 19% to US$2.37. Yet prior to the latest earnings, the analyst had been anticipated revenues of US$570.3m and earnings per share (EPS) of US$2.39 in 2025. So it looks like the analyst has become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.
The consensus price target rose 14% to US$49.00, with the analyst apparently satisfied with the business performance despite lower revenue forecasts.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of CTS'historical trends, as the 6.0% annualised revenue growth to the end of 2025 is roughly in line with the 5.2% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 7.5% annually. So it's pretty clear that CTS is expected to grow slower than similar companies in the same industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analyst holding their earnings forecasts steady, in line with previous estimates. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.