The Epiroc AB (publ) (STO:EPI A) Second-Quarter Results Are Out And Analysts Have Published New Forecasts
Shareholders might have noticed that Epiroc AB (publ) (STO:EPI A) filed its quarterly result this time last week. The early response was not positive, with shares down 8.4% to kr233 in the past week. It looks like the results were a bit of a negative overall. While revenues of kr17b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 3.0% to hit kr2.01 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the current consensus from Epiroc's 19 analysts is for revenues of kr66.6b in 2026. This would reflect a reasonable 6.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to grow 12% to kr8.18. In the lead-up to this report, the analysts had been modelling revenues of kr66.6b and earnings per share (EPS) of kr8.25 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
View our latest analysis for Epiroc
It will come as no surprise then, to learn that the consensus price target is largely unchanged at kr280. 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 Epiroc at kr330 per share, while the most bearish prices it at kr220. 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 Epiroc shareholders.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that Epiroc's rate of growth is expected to accelerate meaningfully, with the forecast 14% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 10% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Epiroc is expected to grow much faster than its 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected 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.
With that in mind, we wouldn't be too quick to come to a conclusion on Epiroc. Long-term earnings power is much more important than next year's profits. We have forecasts for Epiroc going out to 2028, and you can see them free on our platform here.
It might also be worth considering whether Epiroc's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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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.