The quarterly results for Champion Homes, Inc. (NYSE:SKY) were released last week, making it a good time to revisit its performance. Revenues were US$617m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.94, an impressive 40% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Taking into account the latest results, the most recent consensus for Champion Homes from five analysts is for revenues of US$2.43b in 2025. If met, it would imply a reasonable 3.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to soar 30% to US$3.39. Before this earnings report, the analysts had been forecasting revenues of US$2.46b and earnings per share (EPS) of US$3.11 in 2025. So the consensus seems to have become somewhat more optimistic on Champion Homes' earnings potential following these results.

The consensus price target was unchanged at US$88.33, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 Champion Homes at US$100.00 per share, while the most bearish prices it at US$72.00. 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 Champion Homes shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Champion Homes' revenue growth is expected to slow, with the forecast 7.5% annualised growth rate until the end of 2025 being well below the historical 13% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.9% per year. Even after the forecast slowdown in growth, it seems obvious that Champion Homes is also expected to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Champion Homes' earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Champion Homes. Long-term earnings power is much more important than next year's profits. We have forecasts for Champion Homes going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for Champion Homes that you should be aware of.

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