Swedencare AB (publ) Just Missed Earnings - But Analysts Have Updated Their Models
The analysts might have been a bit too bullish on Swedencare AB (publ) (STO:SECARE), given that the company fell short of expectations when it released its quarterly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at kr732m, statutory earnings missed forecasts by an incredible 45%, coming in at just kr0.18 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the most recent consensus for Swedencare from three analysts is for revenues of kr3.06b in 2027. If met, it would imply a meaningful 12% increase on its revenue over the past 12 months. Per-share earnings are expected to soar 125% to kr1.22. In the lead-up to this report, the analysts had been modelling revenues of kr3.12b and earnings per share (EPS) of kr1.36 in 2027. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.
See our latest analysis for Swedencare
The average price target fell 8.5% to kr28.67, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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. There are some variant perceptions on Swedencare, with the most bullish analyst valuing it at kr35.00 and the most bearish at kr21.00 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Swedencare's revenue growth is expected to slow, with the forecast 9.1% annualised growth rate until the end of 2027 being well below the historical 19% 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 28% annually. Factoring in the forecast slowdown in growth, it seems obvious that Swedencare 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 plus side, there were no major changes to revenue estimates; although 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 Swedencare's future valuation.
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 forecasts for Swedencare going out to 2028, and you can see them free on our platform here.
You can also view our analysis of Swedencare's balance sheet, and whether we think Swedencare is carrying too much debt, for free on our platform here.
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