Earnings Beat: Odfjell Technology Ltd. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Odfjell Technology Ltd. (OB:OTL) just released its latest full-year results and things are looking bullish. It was overall a positive result, with revenues beating expectations by 4.7% to hit kr3.9b. Odfjell Technology reported statutory earnings per share (EPS) kr6.12, which was a notable 14% above what the analysts had forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Odfjell Technology after the latest results.

See our latest analysis for Odfjell Technology

Following the latest results, Odfjell Technology's dual analysts are now forecasting revenues of kr4.27b in 2023. This would be a notable 10.0% improvement in sales compared to the last 12 months. Per-share earnings are expected to rise 7.5% to kr6.89. Before this earnings report, the analysts had been forecasting revenues of kr4.26b and earnings per share (EPS) of kr6.72 in 2023. So the consensus seems to have become somewhat more optimistic on Odfjell Technology's earnings potential following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 13% to kr68.37.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Odfjell Technology's revenue growth will slow down substantially, with revenues to the end of 2023 expected to display 10.0% growth on an annualised basis. This is compared to a historical growth rate of 19% over the past three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 14% annually. Factoring in the forecast slowdown in growth, it seems obvious that Odfjell Technology is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Odfjell Technology following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply revenues will perform worse than the wider 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for Odfjell Technology going out as far as 2025, and you can see them free on our platform here.

Before you take the next step you should know about the 2 warning signs for Odfjell Technology that we have uncovered.

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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.