Gamma Communications plc Just Missed EPS By 16%: Here's What Analysts Think Will Happen Next

The full-year results for Gamma Communications plc (LON:GAMA) were released last week, making it a good time to revisit its performance. Revenues were in line with forecasts, at UK£522m, although statutory earnings per share came in 16% below what the analysts expected, at UK£0.55 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.

See our latest analysis for Gamma Communications

Taking into account the latest results, the current consensus from Gamma Communications' eight analysts is for revenues of UK£572.9m in 2024. This would reflect a meaningful 9.8% increase on its revenue over the past 12 months. Per-share earnings are expected to shoot up 32% to UK£0.73. Yet prior to the latest earnings, the analysts had been anticipated revenues of UK£571.6m and earnings per share (EPS) of UK£0.73 in 2024. 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.

The analysts reconfirmed their price target of UK£16.90, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Gamma Communications at UK£22.50 per share, while the most bearish prices it at UK£11.50. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Gamma Communications' past performance and to peers in the same industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 9.8% growth on an annualised basis. That is in line with its 12% 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 1.9% per year. So although Gamma Communications is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share 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.

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. At Simply Wall St, we have a full range of analyst estimates for Gamma Communications going out to 2026, and you can see them free on our platform here..

You can also see our analysis of Gamma Communications' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.