ABC arbitrage SA Just Beat EPS By 9.8%: Here's What Analysts Think Will Happen Next

ABC arbitrage SA (EPA:ABCA) investors will be delighted, with the company turning in some strong numbers with its latest results. Results were good overall, with revenues beating analyst predictions by 3.6% to hit €51m. Statutory earnings per share (EPS) came in at €0.45, some 9.8% above whatthe analyst had expected. Following the result, the analyst has 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 analyst has changed their mind on ABC arbitrage after the latest results.

Taking into account the latest results, the current consensus from ABC arbitrage's sole analyst is for revenues of €53.6m in 2025. This would reflect a satisfactory 4.1% increase on its revenue over the past 12 months. Statutory earnings per share are expected to sink 18% to €0.37 in the same period. Yet prior to the latest earnings, the analyst had been anticipated revenues of €51.2m and earnings per share (EPS) of €0.35 in 2025. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

Check out our latest analysis for ABC arbitrage

With these upgrades, we're not surprised to see that the analyst has lifted their price target 10.0% to €6.60per share.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing stands out from these estimates, which is that ABC arbitrage is forecast to grow faster in the future than it has in the past, with revenues expected to display 4.1% annualised growth until the end of 2025. If achieved, this would be a much better result than the 5.5% annual decline 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 revenue grow 14% per year. So although ABC arbitrage's revenue growth is expected to improve, it is still expected to grow slower than the 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 ABC arbitrage following these results. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse 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.

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 analyst estimates for ABC arbitrage going out as far as 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - ABC arbitrage has 2 warning signs (and 1 which is a bit concerning) we think you should know about.

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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.