Earnings Miss: Amotiv Limited Missed EPS By 20% And Analysts Are Revising Their Forecasts

Amotiv Limited (ASX:AOV) shareholders are probably feeling a little disappointed, since its shares fell 8.3% to AU$6.72 in the week after its latest yearly results. Statutory earnings per share fell badly short of expectations, coming in at AU$0.56, some 20% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at AU$1.0b. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Amotiv after the latest results.

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Following last week's earnings report, Amotiv's eleven analysts are forecasting 2027 revenues to be AU$1.03b, approximately in line with the last 12 months. Per-share earnings are expected to soar 40% to AU$0.79. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$1.06b and earnings per share (EPS) of AU$0.84 in 2027. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

Check out our latest analysis for Amotiv

The consensus price target fell 12% to AU$8.82, with the weaker earnings outlook clearly leading valuation estimates. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Amotiv at AU$12.00 per share, while the most bearish prices it at AU$6.10. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Amotiv's revenue growth is expected to slow, with the forecast 1.0% annualised growth rate until the end of 2027 being well below the historical 9.2% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.9% annually. Factoring in the forecast slowdown in growth, it seems obvious that Amotiv is also expected to grow slower than other industry participants.

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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Amotiv's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Amotiv going out to 2029, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 3 warning signs for Amotiv you should be aware of.

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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.