Yahoo Finance Ethan Allen Interiors Inc. Just Missed Revenue By 13%: Here's What Analysts Think Will Happen Next
Shareholders might have noticed that Ethan Allen Interiors Inc. (NYSE:ETD) filed its third-quarter result this time last week. The early response was not positive, with shares down 7.0% to US$29.06 in the past week. Revenues were US$146m, 13% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of US$4.13 being in line with what the analysts anticipated. 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.
View our latest analysis for Ethan Allen Interiors
Taking into account the latest results, the dual analysts covering Ethan Allen Interiors provided consensus estimates of US$628.2m revenue in 2025, which would reflect a small 5.5% decline over the past 12 months. Statutory earnings per share are expected to dive 21% to US$2.20 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$691.0m and earnings per share (EPS) of US$3.00 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a pretty serious reduction to earnings per share estimates.
It'll come as no surprise then, to learn that the analysts have cut their price target 9.1% to US$30.00.
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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.5% by the end of 2025. This indicates a significant reduction from annual growth of 2.6% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.1% annually for the foreseeable future. It's pretty clear that Ethan Allen Interiors' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that in mind, we wouldn't be too quick to come to a conclusion on Ethan Allen Interiors. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Ethan Allen Interiors going out as far as 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 2 warning signs for Ethan Allen Interiors (1 makes us a bit uncomfortable!) that you should be aware of.
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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.
