TopBuild Corp. (NYSE:BLD) just released its latest quarterly report and things are not looking great. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at US$1.4b, statutory earnings missed forecasts by 13%, coming in at just US$4.78 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on TopBuild after the latest results.
After the latest results, the eleven analysts covering TopBuild are now predicting revenues of US$5.43b in 2024. If met, this would reflect an okay 3.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 9.4% to US$21.34. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.51b and earnings per share (EPS) of US$21.31 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$454. 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. Currently, the most bullish analyst values TopBuild at US$525 per share, while the most bearish prices it at US$395. 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 pretty clear that there is an expectation that TopBuild's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 6.9% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past five years. Compare this to the 86 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 5.8% per year. So it's pretty clear that, while TopBuild's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for TopBuild going out to 2026, and you can see them free on our platform here..
You should always think about risks though. Case in point, we've spotted 1 warning sign for TopBuild you should be aware 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.
