Holley Inc. (NYSE:HLLY) last week reported its latest third-quarter results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues fell 6.0% short of expectations, at US$134m. Earnings correspondingly dipped, with Holley reporting a statutory loss of US$0.05 per share, whereas the analysts had previously modelled a profit in this period. The analysts 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, Holley's nine analysts currently expect revenues in 2025 to be US$627.7m, approximately in line with the last 12 months. Per-share earnings are expected to shoot up 105% to US$0.27. In the lead-up to this report, the analysts had been modelling revenues of US$658.9m and earnings per share (EPS) of US$0.36 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a large cut to earnings per share numbers.

The consensus price target fell 12% to US$5.44, with the weaker earnings outlook clearly leading valuation estimates. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Holley at US$12.00 per share, while the most bearish prices it at US$3.00. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Holley's past performance and to peers in the same industry. We would highlight that Holley's revenue growth is expected to slow, with the forecast 1.3% annualised growth rate until the end of 2025 being well below the historical 5.7% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 9.3% annually. Factoring in the forecast slowdown in growth, it seems obvious that Holley is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Holley. 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. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Holley's future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Holley going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 2 warning signs we've spotted with Holley (including 1 which is concerning) .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.