Shares of Alamo Group Inc. (ALG) soared 5.62% on November 1st, 2024, despite the company reporting lower-than-expected earnings for the third quarter. The industrial equipment manufacturer's earnings per share (EPS) of $2.28 missed analysts' consensus estimate of $2.44, while revenue also fell short of expectations, declining 4.4% year-over-year to $401.3 million.
However, the market overlooked the near-term earnings weakness and instead focused on the company's long-term growth prospects. Analysts remain bullish on Alamo Group, with a consensus "strong buy" rating and a median 12-month price target of $215, implying significant upside potential from current levels.
Despite the third-quarter earnings miss, Alamo Group remains profitable, reporting net income of $19.09 million for the quarter. The company's strong fundamentals and positive outlook appear to have outweighed the temporary earnings setback, driving the stock's impressive surge on November 1st.
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