Shareholders in Expeditors International of Washington, Inc. (NASDAQ:EXPD) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance.

Following this upgrade, Expeditors International of Washington's ten analysts are forecasting 2022 revenues to be US$17b, approximately in line with the last 12 months. Statutory earnings per share are anticipated to descend 11% to US$7.50 in the same period. Prior to this update, the analysts had been forecasting revenues of US$15b and earnings per share (EPS) of US$6.60 in 2022. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for Expeditors International of Washington

As a result, it might be a surprise to see that the analysts have cut their price target 8.8% to US$109, which could suggest the forecast improvement in performance is not expected to last. 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 Expeditors International of Washington at US$125 per share, while the most bearish prices it at US$94.00. This is a very narrow spread of estimates, implying either that Expeditors International of Washington is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Expeditors International of Washington's revenue growth will slow down substantially, with revenues to the end of 2022 expected to display 1.8% growth on an annualised basis. This is compared to a historical growth rate of 17% 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 4.1% per year. Factoring in the forecast slowdown in growth, it seems obvious that Expeditors International of Washington is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for this year. Pleasantly, analysts also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow slower than the wider market. A lower price target is not intuitively what we would expect from a company whose business prospects are improving - at least judging by these forecasts - but if the underlying fundamentals are strong, Expeditors International of Washington could be one for the watch list.

Analysts are definitely bullish on Expeditors International of Washington, but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including concerns around earnings quality. For more information, you can click through to our platform to learn more about this and the 2 other flags we've identified .

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.