It's been a pretty great week for Frontdoor, Inc.( NASDAQ:FTDR ) shareholders, with its shares surging 12% to US$68.80 in the week since its latest first-quarter results. It looks like a credible result overall - although revenues of US$451m were in line with what the analysts predicted, Frontdoor surprised by delivering a statutory profit of US$0.57 per share, a notable 19% above expectations. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the current consensus from Frontdoor's seven analysts is for revenues of US$2.18b in 2026. This would reflect a reasonable 3.0% increase on its revenue over the past 12 months. Per-share earnings are expected to increase 5.3% to US$3.89. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.17b and earnings per share (EPS) of US$3.83 in 2026. 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.
See our latest analysis for Frontdoor
The analysts reconfirmed their price target of US$73.40, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Frontdoor at US$82.00 per share, while the most bearish prices it at US$68.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Frontdoor is an easy business to forecast or the the analysts are all using similar assumptions.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Frontdoor's revenue growth is expected to slow, with the forecast 4.0% annualised growth rate until the end of 2026 being well below the historical 6.2% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.5% per year. Factoring in the forecast slowdown in growth, it seems obvious that Frontdoor is also expected to grow slower than other industry participants.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Frontdoor's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$73.40, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Frontdoor going out to 2028, and you can see them free on our platform here. .
And what about risks? Every company has them, and we've spotted 2 warning signs for Frontdoor you should know about.
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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.
