It's been a sad week for ArcBest Corporation (NASDAQ:ARCB), who've watched their investment drop 11% to US$57.81 in the week since the company reported its first-quarter result. Statutory earnings per share fell badly short of expectations, coming in at US$0.13, some 68% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at US$967m. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. 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, ArcBest's twelve analysts currently expect revenues in 2025 to be US$4.09b, approximately in line with the last 12 months. Statutory earnings per share are expected to nosedive 47% to US$4.12 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.25b and earnings per share (EPS) of US$5.36 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

View our latest analysis for ArcBest

It'll come as no surprise then, to learn that the analysts have cut their price target 15% to US$79.08. 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 ArcBest, with the most bullish analyst valuing it at US$140 and the most bearish at US$58.00 per share. 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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.6% by the end of 2025. This indicates a significant reduction from annual growth of 8.4% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 7.4% per year. It's pretty clear that ArcBest's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will 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.

With that in mind, we wouldn't be too quick to come to a conclusion on ArcBest. Long-term earnings power is much more important than next year's profits. We have forecasts for ArcBest 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 2 warning signs for ArcBest (of which 1 is potentially serious!) you should know about.

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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.