A week ago, Methode Electronics, Inc. (NYSE:MEI) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. Revenues and losses per share were both better than expected, with revenues of US$293m leading estimates by 9.0%. Statutory losses were smaller than the analystsexpected, coming in at US$0.05 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Methode Electronics after the latest results.

Taking into account the latest results, Methode Electronics' four analysts currently expect revenues in 2025 to be US$1.09b, approximately in line with the last 12 months. The loss per share is expected to greatly reduce in the near future, narrowing 87% to US$0.33. Before this latest report, the consensus had been expecting revenues of US$1.08b and US$0.70 per share in losses. Although the revenue estimates have not really changed Methode Electronics'future looks a little different to the past, with a very favorable reduction to the loss per share forecasts in particular.

These new estimates led to the consensus price target rising 29% to US$14.67, with lower forecast losses suggesting things could be looking up for Methode Electronics. 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. There are some variant perceptions on Methode Electronics, with the most bullish analyst valuing it at US$16.00 and the most bearish at US$14.00 per share. This is a very narrow spread of estimates, implying either that Methode Electronics is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Methode Electronics' revenue growth is expected to slow, with the forecast 1.1% annualised growth rate until the end of 2025 being well below the historical 2.3% 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 7.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that Methode Electronics is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Methode Electronics' 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 estimates - from multiple Methode Electronics analysts - going out to 2027, and you can see them free on our platform here.

Even so, be aware that Methode Electronics is showing 2 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

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