Yahoo Finance Results: KLA Corporation Beat Earnings Expectations And Analysts Now Have New Forecasts
It's been a pretty great week for KLA Corporation (NASDAQ:KLAC) shareholders, with its shares surging 13% to US$714 in the week since its latest third-quarter results. KLA reported US$2.4b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$4.43 beat expectations, being 5.7% higher than what the analysts expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for KLA
Taking into account the latest results, the current consensus from KLA's 22 analysts is for revenues of US$11.1b in 2025. This would reflect a solid 16% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 39% to US$27.03. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$11.0b and earnings per share (EPS) of US$26.25 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target was unchanged at US$727, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 KLA analyst has a price target of US$850 per share, while the most pessimistic values it at US$530. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that KLA's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 18% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 17% annually. Factoring in the forecast slowdown in growth, it seems obvious that KLA is also expected to grow slower than other industry participants.
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 KLA following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$727, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for KLA going out to 2026, and you can see them free on our platform here..
It is also worth noting that we have found 1 warning sign for KLA that you need to take into consideration.
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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.
