Last week, you might have seen that Marten Transport, Ltd. (NASDAQ:MRTN) released its quarterly result to the market. The early response was not positive, with shares down 2.5% to US$16.96 in the past week. Results look mixed - while revenue fell marginally short of analyst estimates at US$216m, statutory earnings beat expectations 10.0%, with Marten Transport reporting profits of US$0.22 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
After the latest results, the four analysts covering Marten Transport are now predicting revenues of US$942.8m in 2021. If met, this would reflect a solid 9.1% improvement in sales compared to the last 12 months. Per-share earnings are expected to ascend 18% to US$0.94. In the lead-up to this report, the analysts had been modelling revenues of US$949.0m and earnings per share (EPS) of US$0.88 in 2021. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target rose 6.0% to US$20.50, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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 Marten Transport at US$23.00 per share, while the most bearish prices it at US$17.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Marten Transport's growth to accelerate, with the forecast 9.1% growth ranking favourably alongside historical growth of 6.4% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 8.5% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Marten Transport is expected to grow at about the same rate as 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 Marten Transport's earnings potential next year. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Marten Transport going out to 2022, 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 Marten Transport you should be aware of.
This article by Simply Wall St is general in nature. 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.
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