Here are analysts’ predictions for the future

Hillman Solutions Corp. Hillman Solutions (NASDAQ:HLMN) released its latest second-quarter results last week, making it a good time for investors to dive in and see if the business is in line with expectations. Hillman Solutions reported revenue of $379 million, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of $0.06 beat expectations, coming in 9.1% ahead of analyst expectations. Analysts typically update their forecasts with each earnings report, and we can gauge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we’ve gathered the latest statutory consensus estimates after the results to see what could be in store for the coming year.

See our latest analysis for Hillman Solutions

Following last week’s earnings report, nine Hillman Solutions analysts are forecasting 2024 revenue of $1.46 billion, roughly in line with the past 12 months. Earnings per share are expected to jump 355% to $0.14. Prior to this report, the analysts had been modeling revenue of $1.50 billion and earnings per share (EPS) of $0.12 in 2024. While revenue forecasts have been revised down, analysts appear to be more optimistic about the company’s cost base given the significant expansion in earnings per share numbers.

The consensus made no significant changes to the $12.00 price target, suggesting that the projected improvement in earnings is expected to offset the revenue decline next year. It can also be instructive to look at the range of analyst estimates to assess how much the outliers differ from the average. There are some differing perceptions regarding Hillman Solutions, with the most bullish analyst valuing it at $16.00 and the most bearish at $9.00 per share. There are definitely some differing views on the stock, but the range of estimates is not wide enough to suggest that things are unpredictable, in our view.

One way to gain more context for these forecasts is to compare them to past performance and to other companies in the same industry. These estimates suggest that revenues are set to decline, with a projected annual decline of 1.6% through the end of 2024. This is a significant reduction from the 3.1% annual growth over the past five years. Compare this to our data, which suggests that other companies in the same industry are expected to collectively see revenue growth of 3.2% per year. It’s pretty clear that Hillman Solutions’ revenues are set to decline significantly compared to the broader industry.

Summary

The biggest takeaway for us is the consensus for an earnings per share upgrade, which suggests a clear improvement in sentiment around Hillman Solutions’ earnings potential next year. Unfortunately, they also lowered their revenue estimates, and our data indicates an underperformance relative to the broader industry. That said, earnings per share are more important for the intrinsic value of a company. Earnings per share are still more important for creating shareholder value. The consensus price target remained steady at $12.00, and the latest estimates were not enough to have an impact on their price targets.

With that in mind, the long-term earnings trajectory of the company is much more important than next year. We have forecasts for Hillman Solutions out to 2026, and you can see them for free on our platform here.

Nevertheless, it is important to remember that Hillman Solutions shows 2 warning signs in our investment analysis and one of them cannot be ignored…

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This Simply Wall St article is for general information purposes only. Our commentary is based solely on historical data and analyst forecasts, and is based on an objective methodology. Our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or your financial situation. Our goal is to provide you with long-term, focused analysis based on fundamental data. Please note that our analysis may not reflect the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.