Life Time Group Holdings, Inc. (NYSE:LTH) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 3.4% to hit US$706m. Life Time Group Holdings also reported a statutory profit of US$0.34, which was an impressive 31% above what the analysts had forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the consensus forecast from Life Time Group Holdings' 13 analysts is for revenues of US$2.97b in 2025. This reflects a meaningful 8.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 33% to US$1.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.96b and earnings per share (EPS) of US$1.23 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
View our latest analysis for Life Time Group Holdings
The consensus price target was unchanged at US$38.04, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Life Time Group Holdings at US$45.00 per share, while the most bearish prices it at US$28.00. 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.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Life Time Group Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past three years. Compare this to the 162 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 9.7% per year. Factoring in the forecast slowdown in growth, it looks like Life Time Group Holdings is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Life Time Group Holdings' earnings potential next year. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$38.04, 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. We have forecasts for Life Time Group Holdings going out to 2027, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for Life Time Group Holdings that you need to take into consideration.
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.