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Investors in Pactiv Evergreen Inc. (NASDAQ:PTVE) had a good week, as its shares rose 4.5% to close at US$12.29 following the release of its third-quarter results. Revenues fell 3.0% short of expectations, at US$1.3b. Earnings correspondingly dipped, with Pactiv Evergreen reporting a statutory loss of US$1.18 per share, whereas the analysts had previously modelled a profit in this period. 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 Pactiv Evergreen after the latest results.
Check out our latest analysis for Pactiv Evergreen
Taking into account the latest results, Pactiv Evergreen's six analysts currently expect revenues in 2025 to be US$5.27b, approximately in line with the last 12 months. Earnings are expected to improve, with Pactiv Evergreen forecast to report a statutory profit of US$1.08 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.24b and earnings per share (EPS) of US$1.18 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$14.50, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Pactiv Evergreen analyst has a price target of US$17.00 per share, while the most pessimistic values it at US$12.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Pactiv Evergreen shareholders.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Pactiv Evergreen's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Pactiv Evergreen's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 1.1% growth on an annualised basis. This is compared to a historical growth rate of 4.8% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.6% per year. Factoring in the forecast slowdown in growth, it seems obvious that Pactiv Evergreen is also expected to grow slower than other industry participants.