Herc Holdings Inc. (NYSE:HRI) shareholders are probably feeling a little disappointed, since its shares fell 2.1% to US$201 in the week after its latest full-year results. It looks like a pretty bad result, all things considered. Although revenues of US$3.6b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 44% to hit US$7.40 per share. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Herc Holdings

After the latest results, the nine analysts covering Herc Holdings are now predicting revenues of US$3.67b in 2025. If met, this would reflect a satisfactory 2.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 74% to US$12.94. In the lead-up to this report, the analysts had been modelling revenues of US$3.74b and earnings per share (EPS) of US$13.92 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

The analysts made no major changes to their price target of US$240, suggesting the downgrades are not expected to have a long-term impact on Herc Holdings' valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Herc Holdings analyst has a price target of US$294 per share, while the most pessimistic values it at US$155. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Herc Holdings' revenue growth is expected to slow, with the forecast 2.8% annualised growth rate until the end of 2025 being well below the historical 16% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that Herc Holdings is also expected to grow slower than other industry participants.

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. The consensus price target held steady at US$240, with the latest estimates not enough to have an impact on their price targets.

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 can't be ignored!) 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.