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It's been a mediocre week for Douglas Dynamics, Inc. (NYSE:PLOW) shareholders, with the stock dropping 12% to US$22.65 in the week since its latest quarterly results. Revenues of US$129m fell slightly short of expectations, but earnings were a definite bright spot, with statutory per-share profits of US$1.36 an impressive 670% 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
View our latest analysis for Douglas Dynamics
After the latest results, the three analysts covering Douglas Dynamics are now predicting revenues of US$621.4m in 2025. If met, this would reflect a decent 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to dive 27% to US$1.71 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$660.0m and earnings per share (EPS) of US$1.84 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.
The consensus price target fell 5.6% to US$33.67, with the weaker earnings outlook clearly leading valuation estimates. 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 Douglas Dynamics, with the most bullish analyst valuing it at US$39.00 and the most bearish at US$30.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
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. It's clear from the latest estimates that Douglas Dynamics' rate of growth is expected to accelerate meaningfully, with the forecast 8.8% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 2.6% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.0% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Douglas Dynamics is expected to grow much faster than its industry.