Investors in ALS Limited (ASX:ALQ) had a good week, as its shares rose 8.7% to close at AU$16.16 following the release of its half-yearly results. It was a workmanlike result, with revenues of AU$1.5b coming in 2.1% ahead of expectations, and statutory earnings per share of AU$0.026, in line with analyst appraisals. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for ALS ASX:ALQ Earnings and Revenue Growth November 22nd 2024

Taking into account the latest results, the consensus forecast from ALS' ten analysts is for revenues of AU$2.98b in 2025. This reflects a meaningful 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 4,512% to AU$0.59. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$2.93b and earnings per share (EPS) of AU$0.60 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

The consensus price target rose 6.7% to AU$15.40despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of ALS' earnings by assigning a price premium. 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 ALS analyst has a price target of AU$17.70 per share, while the most pessimistic values it at AU$10.20. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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 clear from the latest estimates that ALS' rate of growth is expected to accelerate meaningfully, with the forecast 22% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 8.8% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.7% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect ALS to grow faster than the wider industry.

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The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for ALS going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the  3 warning signs  we've spotted with ALS .

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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.

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