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Columbus McKinnon Corporation Just Missed EPS By 12%: Here's What Analysts Think Will Happen Next

It's been a mediocre week for Columbus McKinnon Corporation (NASDAQ:CMCO) shareholders, with the stock dropping 13% to US$39.10 in the week since its latest full-year results. Revenues were in line with forecasts, at US$1.0b, although statutory earnings per share came in 12% below what the analysts expected, at US$1.61 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for Columbus McKinnon

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Taking into account the latest results, the most recent consensus for Columbus McKinnon from three analysts is for revenues of US$1.04b in 2025. If met, it would imply a modest 2.1% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 44% to US$2.33. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.06b and earnings per share (EPS) of US$2.22 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

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There's been no major changes to the consensus price target of US$49.25, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Columbus McKinnon analyst has a price target of US$50.00 per share, while the most pessimistic values it at US$48.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Columbus McKinnon is an easy business to forecast or the the analysts are all using similar assumptions.

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 Columbus McKinnon's revenue growth is expected to slow, with the forecast 2.1% annualised growth rate until the end of 2025 being well below the historical 5.2% 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 3.7% per year. Factoring in the forecast slowdown in growth, it seems obvious that Columbus McKinnon is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Columbus McKinnon's earnings potential next year. 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 held steady at US$49.25, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Columbus McKinnon going out to 2026, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 1 warning sign for Columbus McKinnon that you should be aware of.

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.