Axfood AB (publ) (STO:AXFO) Just Released Its Third-Quarter Earnings: Here's What Analysts Think

Investors in Axfood AB (publ) (STO:AXFO) had a good week, as its shares rose 3.5% to close at kr278 following the release of its third-quarter results. It was a credible result overall, with revenues of kr23b and statutory earnings per share of kr3.45 both in line with analyst estimates, showing that Axfood is executing in line with 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

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Taking into account the latest results, the current consensus from Axfood's seven analysts is for revenues of kr94.9b in 2027. This would reflect an okay 5.1% increase on its revenue over the past 12 months. Per-share earnings are expected to grow 14% to kr12.98. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr94.8b and earnings per share (EPS) of kr12.88 in 2027. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

Check out our latest analysis for Axfood

The analysts reconfirmed their price target of kr267, 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. The most optimistic Axfood analyst has a price target of kr305 per share, while the most pessimistic values it at kr215. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Axfood shareholders.

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 Axfood's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 4.0% growth on an annualised basis. This is compared to a historical growth rate of 8.4% over the past five years. Compare this to the 58 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.0% per year. So it's pretty clear that, while Axfood's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Axfood analysts - going out to 2028, and you can see them free on our platform here.

You can also view our analysis of Axfood's balance sheet, and whether we think Axfood is carrying too much debt, for free on our platform here.

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