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Earnings Beat: Hexatronic Group AB (publ) Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Hexatronic Group AB (publ) (STO:HTRO) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat forecasts, with revenue of kr2.5b, some 9.5% above estimates, and statutory earnings per share (EPS) coming in at kr0.81, 28% ahead of 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Hexatronic Group after the latest results.
Following the latest results, Hexatronic Group's three analysts are now forecasting revenues of kr9.63b in 2027. This would be a solid 16% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to shoot up 76% to kr2.78. In the lead-up to this report, the analysts had been modelling revenues of kr9.38b and earnings per share (EPS) of kr2.58 in 2027. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
Check out our latest analysis for Hexatronic Group
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of kr47.79, suggesting that the forecast performance does not have a long term impact on the company's valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Hexatronic Group analyst has a price target of kr50.00 per share, while the most pessimistic values it at kr43.36. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hexatronic Group's past performance and to peers in the same industry. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 13% growth on an annualised basis. That is in line with its 11% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.9% per year. So it's pretty clear that Hexatronic Group is forecast to grow substantially faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Hexatronic Group's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Hexatronic Group analysts - going out to 2028, and you can see them free on our platform here.
You can also see whether Hexatronic Group is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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