As you might know, El Pollo Loco Holdings, Inc. (NASDAQ:LOCO) recently reported its quarterly numbers. It looks like the results were a bit of a negative overall. While revenues of US$126m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 2.5% to hit US$0.23 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, El Pollo Loco Holdings' seven analysts are now forecasting revenues of US$526.0m in 2027. This would be a modest 4.0% improvement in revenue compared to the last 12 months. Statutory earnings per share are forecast to dip 4.2% to US$1.09 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$525.2m and earnings per share (EPS) of US$1.09 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
Check out our latest analysis for El Pollo Loco Holdings
The consensus price target rose 11% to US$20.75despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of El Pollo Loco Holdings' earnings by assigning a price premium. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on El Pollo Loco Holdings, with the most bullish analyst valuing it at US$23.00 and the most bearish at US$17.00 per share. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting El Pollo Loco Holdings is an easy business to forecast or the the analysts are all using similar assumptions.
Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting El Pollo Loco Holdings' growth to accelerate, with the forecast 3.2% annualised growth to the end of 2027 ranking favourably alongside historical growth of 1.8% per annum 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 9.2% per year. So it's clear that despite the acceleration in growth, El Pollo Loco Holdings is expected to grow meaningfully slower than the industry average.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that El Pollo Loco Holdings' revenue is expected to perform worse 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 El Pollo Loco Holdings. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple El Pollo Loco Holdings analysts - going out to 2028, and you can see them free on our platform here.
You can also see whether El Pollo Loco Holdings is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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