Sensata Technologies Holding plc Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
Sensata Technologies Holding plc (NYSE:ST) just released its quarterly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 3.9% to hit US$788m. Sensata Technologies Holding also reported a statutory profit of US$0.49, which was an impressive 111% above what the analysts had forecast. 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 Sensata Technologies Holding
Taking into account the latest results, the most recent consensus for Sensata Technologies Holding from 19 analysts is for revenues of US$3.42b in 2021 which, if met, would be a decent 14% increase on its sales over the past 12 months. Statutory earnings per share are predicted to bounce 229% to US$2.00. Before this earnings report, the analysts had been forecasting revenues of US$3.32b and earnings per share (EPS) of US$1.95 in 2021. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 5.5% to US$53.30per share. 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 Sensata Technologies Holding analyst has a price target of US$63.00 per share, while the most pessimistic values it at US$47.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Sensata Technologies Holding's growth to accelerate, with the forecast 14% growth ranking favourably alongside historical growth of 1.9% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.4% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Sensata Technologies Holding is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Sensata Technologies Holding following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that in mind, we wouldn't be too quick to come to a conclusion on Sensata Technologies Holding. Long-term earnings power is much more important than next year's profits. We have forecasts for Sensata Technologies Holding going out to 2024, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 4 warning signs for Sensata Technologies Holding you should be aware of, and 1 of them makes us a bit uncomfortable.
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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