Hexagon Composites ASA (OB:HEX) Analysts Are Pretty Bullish On The Stock After Recent Results

Shareholders of Hexagon Composites ASA (OB:HEX) will be pleased this week, given that the stock price is up 10% to kr36.12 following its latest full-year results. The results were positive, with revenue coming in at kr4.9b, beating analyst expectations by 2.2%. Following the result, the analysts have 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Hexagon Composites

Taking into account the latest results, the most recent consensus for Hexagon Composites from two analysts is for revenues of kr6.04b in 2023 which, if met, would be a huge 23% increase on its sales over the past 12 months. Per-share losses are expected to explode, reaching kr2.34 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of kr5.99b and losses of kr2.16 per share in 2023. Overall it looks as though the analysts were a bit mixed on the latest consensus updates. Although sales forecasts held steady, the consensus also made a modest increase to its losses per share forecasts.

Although the analysts are now forecasting higher losses, the average price target rose 12% to 33.66667, which could indicate that these losses are expected to be "one-off", or are not anticipated to have a longer-term impact on the business.

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. The period to the end of 2023 brings more of the same, according to the analysts, with revenue forecast to display 23% growth on an annualised basis. That is in line with its 22% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 23% per year. So although Hexagon Composites is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. Happily, there were no real changes to sales forecasts, with the business still expected to grow in line with the overall industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for Hexagon Composites going out as far as 2025, and you can see them free on our platform here.

It might also be worth considering whether Hexagon Composites' debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

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

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.