Shareholders will be ecstatic, with their stake up 21% over the past week following American Axle & Manufacturing Holdings, Inc.'s (NYSE:AXL) latest second-quarter results. Revenues were US$1.5b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.32, an impressive 57% ahead of estimates. 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.
Following last week's earnings report, American Axle & Manufacturing Holdings' seven analysts are forecasting 2025 revenues to be US$5.83b, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 6.9% to US$0.37. Before this earnings report, the analysts had been forecasting revenues of US$5.83b and earnings per share (EPS) of US$0.35 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 American Axle & Manufacturing Holdings
There's been no major changes to the consensus price target of US$5.89, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. 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. Currently, the most bullish analyst values American Axle & Manufacturing Holdings at US$7.50 per share, while the most bearish prices it at US$4.50. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
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 pretty clear that there is an expectation that American Axle & Manufacturing Holdings' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 0.04% 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 13% per year. Factoring in the forecast slowdown in growth, it seems obvious that American Axle & Manufacturing Holdings is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards American Axle & Manufacturing Holdings following these results. 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$5.89, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on American Axle & Manufacturing Holdings. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for American Axle & Manufacturing Holdings going out to 2027, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 1 warning sign for American Axle & Manufacturing Holdings you should know about.
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.