Goosehead Insurance (GSHD) reported quarterly earnings of $0.50 per share, beating the Zacks Consensus Estimate of $0.46 per share. This compares to earnings of $0.46 per share a year ago. These figures are adjusted for one-time items.
This quarterly report represents an earnings surprise of 8.70%. A quarter ago, it was expected that this insurance company would post earnings of $0.40 per share when it actually produced earnings of $0.42 corresponds to a surprise of 5%.
Over the last four quarters, the company has surpassed consensus EPS estimates three times.
Goosehead, which belongs to the Zacks Insurance Multi-Line industry, posted revenues of $78.04 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 2.85%. This compares to year-ago revenue of $71.03 million. The company has topped consensus revenue estimates just once in the last four quarters.
The sustainability of the stock’s immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management’s commentary on the earnings release.
Goosehead shares have gained about 26.1% since the beginning of the year versus the S&P 500’s gain of 22.7%.
While Goosehead has outperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarters, but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend is unfavorable for Goosehead. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status results in a Zacks Rank #4 (Sell) for the stock. Therefore, the stock is expected to underperform the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the coming days. The current consensus EPS estimate is $0.37 on revenues of $76.24 million for the coming quarter and $1.52 on revenues of $299.13 million for the current one fiscal year.
