Results: Dicker Data Limited Beat Earnings Expectations And Analysts Now Have New Forecasts

A week ago, Dicker Data Limited (ASX:DDR) came out with a strong set of yearly numbers that could potentially lead to a re-rate of the stock. Results were good overall, with revenues beating analyst predictions by 4.4% to hit AU$2.0b. Statutory earnings per share (EPS) came in at AU$0.34, some 7.4% above whatthe analyst had expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

Check out our latest analysis for Dicker Data

Taking into account the latest results, the most recent consensus for Dicker Data from sole analyst is for revenues of AU$2.23b in 2021 which, if met, would be a solid 12% increase on its sales over the past 12 months. Per-share earnings are expected to expand 14% to AU$0.39. Yet prior to the latest earnings, the analyst had been anticipated revenues of AU$2.07b and earnings per share (EPS) of AU$0.35 in 2021. So it seems there's been a definite increase in optimism about Dicker Data's future following the latest results, with a substantial gain in the earnings per share forecasts in particular.

It will come as no surprise to learn that the analyst has increased their price target for Dicker Data 13% to AU$13.05on the back of these upgrades.

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. We can infer from the latest estimates that forecasts expect a continuation of Dicker Data'shistorical trends, as next year's 12% revenue growth is roughly in line with 13% annual revenue 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 22% per year. So it's pretty clear that Dicker Data is expected to grow slower than similar companies in the same industry.

The Bottom Line

The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Dicker Data following these results. They also upgraded their revenue estimates for next year, even though sales are expected to grow slower than the wider industry. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2023, which can be seen for free on our platform here.

It is also worth noting that we have found 4 warning signs for Dicker Data (1 can't be ignored!) that you need to take into consideration.

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This article by Simply Wall St is general in nature. 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.
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