It’s been a pretty great week for Aptiv PLC (NYSE:APTV) shareholders, with its shares surging 13% to US$80.82 in the week since its latest quarterly results. It looks like a credible result overall – although revenues of US$4.9b were in line with what the analysts predicted, Aptiv surprised by delivering a statutory profit of US$0.79 per share, a notable 11% above expectations. Earnings are an important time for investors, as they can track a company’s performance, look at what the analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for Aptiv
Taking into account the latest results, the current consensus from Aptiv’s 21 analysts is for revenues of US$21.3b in 2024. This would reflect a modest 5.8% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to nosedive 58% to US$4.57 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$21.5b and earnings per share (EPS) of US$4.44 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
There’s been no major changes to the consensus price target of US$102, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock’s valuation. The consensus price target is just an average of individual analyst targets, so – it could be handy to see how wide the range of underlying estimates is. The most optimistic Aptiv analyst has a price target of US$145 per share, while the most pessimistic values it at US$58.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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 can infer from the latest estimates that forecasts expect a continuation of Aptiv’shistorical trends, as the 7.8% annualised revenue growth to the end of 2024 is roughly in line with the 8.7% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 11% annually. So it’s pretty clear that Aptiv is expected to grow slower than similar companies in the same industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Aptiv’s earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it’s tracking in line with expectations. Although our data does suggest that Aptiv’s revenue is expected to perform worse 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 said, the long-term trajectory of the company’s earnings is a lot more important than next year. We have estimates – from multiple Aptiv analysts – going out to 2026, and you can see them free on our platform here.
You still need to take note of risks, for example – Aptiv has 3 warning signs (and 1 which can’t be ignored) we think you should know about.
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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.