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AAON, Inc. (NASDAQ:AAON) just released its latest quarterly results and things are looking bullish. It was a solid earnings report, with revenues and statutory earnings per share (EPS) both coming in strong. Revenues were 11% higher than the analysts had forecast, at US$322m, while EPS were US$0.35 beating analyst models by 51%. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
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Taking into account the latest results, the consensus forecast from AAON's six analysts is for revenues of US$1.42b in 2025. This reflects a meaningful 12% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 8.3% to US$2.11. Before this earnings report, the analysts had been forecasting revenues of US$1.41b and earnings per share (EPS) of US$2.14 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
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It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$110. 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. Currently, the most bullish analyst values AAON at US$125 per share, while the most bearish prices it at US$96.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
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. We would highlight that AAON's revenue growth is expected to slow, with the forecast 17% annualised growth rate until the end of 2025 being well below the historical 23% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.4% per year. So it's pretty clear that, while AAON's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.