Shareholders might have noticed that Herc Holdings Inc. (NYSE:HRI) filed its first-quarter result this time last week. The early response was not positive, with shares down 9.4% to US$105 in the past week. Things were not great overall, with a surprise (statutory) loss of US$0.63 per share on revenues of US$861m, even though the analysts had been expecting a profit. 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.

Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit.

Following last week's earnings report, Herc Holdings' nine analysts are forecasting 2025 revenues to be US$3.64b, approximately in line with the last 12 months. Per-share earnings are expected to shoot up 109% to US$9.41. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$3.66b and earnings per share (EPS) of US$12.78 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the large cut to new EPS forecasts.

Check out our latest analysis for Herc Holdings

It might be a surprise to learn that the consensus price target fell 11% to US$180, with the analysts clearly linking lower forecast earnings to the performance of the stock price. 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. The most optimistic Herc Holdings analyst has a price target of US$285 per share, while the most pessimistic values it at US$100.00. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the 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. It's pretty clear that there is an expectation that Herc Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 0.7% growth on an annualised basis. This is compared to a historical growth rate of 16% 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 6.0% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Herc Holdings.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Herc Holdings. 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 fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Herc Holdings' future valuation.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Herc Holdings going out to 2027, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 3 warning signs for Herc Holdings (of which 1 shouldn't be ignored!) you should know about.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.