Earnings Update: Invinity Energy Systems plc (LON:IES) Just Reported Its Annual Results And Analysts Are Updating Their Forecasts

Invinity Energy Systems plc (LON:IES) missed earnings with its latest annual results, disappointing overly-optimistic forecasters. The numbers were fairly weak, with revenue of UK£22m missing analyst predictions by 5.1%, and (statutory) losses of UK£0.13 per share being slightly larger than what the analysts had expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Invinity Energy Systems

After the latest results, the four analysts covering Invinity Energy Systems are now predicting revenues of UK£36.3m in 2024. If met, this would reflect a major 65% improvement in revenue compared to the last 12 months. Losses are forecast to narrow 7.4% to UK£0.049 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of UK£36.4m and losses of UK£0.051 per share in 2024. It looks like there's been a modest increase in sentiment in the recent updates, with the analysts becoming a bit more optimistic in their predictions for losses per share, even though the revenue numbers were unchanged.

There's been no major changes to the consensus price target of UK£0.81, suggesting that reduced loss estimates are not enough to have a long-term positive impact on the stock's valuation. 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 Invinity Energy Systems, with the most bullish analyst valuing it at UK£1.10 and the most bearish at UK£0.65 per share. 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 Invinity Energy Systems shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Invinity Energy Systems'historical trends, as the 65% annualised revenue growth to the end of 2024 is roughly in line with the 67% 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 15% per year. So it's pretty clear that Invinity Energy Systems is forecast to grow substantially faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, there were no major changes to revenue forecasts, with the business still 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Invinity Energy Systems going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Invinity Energy Systems (1 is concerning) you should be aware of.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com