The investors in Vestis Corporation's (NYSE:VSTS) will be rubbing their hands together with glee today, after the share price leapt 31% to US$12.17 in the week following its second-quarter results. Results were roughly in line with estimates, with revenues of US$659m and statutory earnings per share of US$0.02. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Following last week's earnings report, Vestis' seven analysts are forecasting 2026 revenues to be US$2.66b, approximately in line with the last 12 months. Earnings are expected to improve, with Vestis forecast to report a statutory profit of US$0.077 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.65b and earnings per share (EPS) of US$0.095 in 2026. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.

Despite cutting their earnings forecasts,the analysts have lifted their price target 19% to US$9.30, suggesting that these impacts are not expected to weigh on the stock's value in the long term. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Vestis analyst has a price target of US$14.00 per share, while the most pessimistic values it at US$5.60. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Vestis' past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 3.5% by the end of 2026. This indicates a significant reduction from annual growth of 0.9% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.8% per year. It's pretty clear that Vestis' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Vestis' revenue is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Vestis going out to 2028, and you can see them free on our platform here.

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.