The investors in Ameresco, Inc.'s (NYSE:AMRC) will be rubbing their hands together with glee today, after the share price leapt 25% to US$26.51 in the week following its third-quarter results. Revenues were US$580m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.59 were also better than expected, beating analyst predictions by 13%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, Ameresco's twelve analysts are now forecasting revenues of US$2.33b in 2027. This would be a notable 12% improvement in revenue compared to the last 12 months. Ameresco is also expected to turn profitable, with statutory earnings of US$1.62 per share. In the lead-up to this report, the analysts had been modelling revenues of US$2.31b and earnings per share (EPS) of US$1.49 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
View our latest analysis for Ameresco
The consensus price target fell 5.6% to US$39.10, suggesting the increase in earnings forecasts was not enough to offset other the analysts concerns. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Ameresco at US$61.00 per share, while the most bearish prices it at US$26.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 9.6% growth on an annualised basis. That is in line with its 8.0% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 13% per year. So although Ameresco is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider 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 Ameresco following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Ameresco's revenue is expected to perform worse than the wider industry. 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Ameresco analysts - going out to 2028, and you can see them free on our platform here.
Before you take the next step you should know about the 2 warning signs for Ameresco (1 is a bit unpleasant!) that we have uncovered.
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