Analysts Have Made A Financial Statement On Service Corporation International's (NYSE:SCI) Third-Quarter Report

Simply Wall St.
2024-11-02

It's been a good week for Service Corporation International (NYSE:SCI) shareholders, because the company has just released its latest quarterly results, and the shares gained 8.2% to US$81.62. The result was positive overall - although revenues of US$1.0b were in line with what the analysts predicted, Service Corporation International surprised by delivering a statutory profit of US$0.81 per share, modestly greater than expected. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Service Corporation International

NYSE:SCI Earnings and Revenue Growth November 2nd 2024

Taking into account the latest results, the most recent consensus for Service Corporation International from six analysts is for revenues of US$4.32b in 2025. If met, it would imply a satisfactory 4.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to swell 13% to US$3.93. In the lead-up to this report, the analysts had been modelling revenues of US$4.31b and earnings per share (EPS) of US$3.92 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.

There were no changes to revenue or earnings estimates or the price target of US$87.30, suggesting that the company has met expectations in its recent result. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Service Corporation International, with the most bullish analyst valuing it at US$93.00 and the most bearish at US$79.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Service Corporation International's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.2% growth on an annualised basis. This is compared to a historical growth rate of 5.3% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 11% per year. Factoring in the forecast slowdown in growth, it seems obvious that Service Corporation International is also expected to grow slower than other industry participants.

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. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

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. At Simply Wall St, we have a full range of analyst estimates for Service Corporation International going out to 2026, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for Service Corporation International (1 is significant!) that we have uncovered.

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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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