It's been a good week for AZZ Inc. (NYSE:AZZ) shareholders, because the company has just released its latest yearly results, and the shares gained 9.0% to US$82.43. It was a credible result overall, with revenues of US$1.5b and statutory earnings per share of US$3.46 both in line with analyst estimates, showing that AZZ is executing in line with expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for AZZ

Taking into account the latest results, the consensus forecast from AZZ's four analysts is for revenues of US$1.59b in 2025. This reflects a satisfactory 3.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 16% to US$4.03. In the lead-up to this report, the analysts had been modelling revenues of US$1.58b and earnings per share (EPS) of US$3.88 in 2025. So the consensus seems to have become somewhat more optimistic on AZZ's earnings potential following these results.

The consensus price target rose 8.5% to US$84.67, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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. Currently, the most bullish analyst values AZZ at US$89.00 per share, while the most bearish prices it at US$80.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that AZZ's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.4% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 5.5% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than AZZ.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around AZZ's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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. At Simply Wall St, we have a full range of analyst estimates for AZZ going out to 2026, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for AZZ that you need to be mindful of.

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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.