Yahoo Finance U.S. Physical Therapy, Inc. (NYSE:USPH) Just Beat EPS By 6.1%: Here's What Analysts Are Forecasting For Next Year
A week ago, U.S. Physical Therapy, Inc. (NYSE:USPH) came out with a strong set of third-quarter numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of US$109m arriving 5.3% ahead of forecasts. Statutory earnings per share (EPS) were US$0.61, 6.1% ahead of estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for U.S. Physical Therapy
Taking into account the latest results, the consensus forecast from U.S. Physical Therapy's five analysts is for revenues of US$462.4m in 2021, which would reflect a decent 9.4% improvement in sales compared to the last 12 months. Per-share earnings are expected to leap 28% to US$3.02. Before this earnings report, the analysts had been forecasting revenues of US$457.3m and earnings per share (EPS) of US$2.63 in 2021. Although the revenue estimates have not really changed, we can see there's been a substantial gain in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target rose 11% to US$99.00, suggesting that higher earnings estimates flow through to the stock's valuation as well. 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 U.S. Physical Therapy analyst has a price target of US$116 per share, while the most pessimistic values it at US$86.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that U.S. Physical Therapy's rate of growth is expected to accelerate meaningfully, with the forecast 9.4% revenue growth noticeably faster than its historical growth of 7.7%p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect U.S. Physical Therapy to grow faster than 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 U.S. Physical Therapy's earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected 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 U.S. Physical Therapy. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple U.S. Physical Therapy analysts - going out to 2022, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for U.S. Physical Therapy that 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
