Earnings Miss: Atea ASA Missed EPS By 32% And Analysts Are Revising Their Forecasts

It's shaping up to be a tough period for Atea ASA (OB:ATEA), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at kr8.4b, statutory earnings missed forecasts by an incredible 32%, coming in at just kr1.23 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. 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 Atea

Taking into account the latest results, the consensus forecast from Atea's four analysts is for revenues of kr34.6b in 2024. This reflects a reasonable 4.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to step up 19% to kr8.10. Before this earnings report, the analysts had been forecasting revenues of kr36.9b and earnings per share (EPS) of kr8.98 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the kr153 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Atea at kr180 per share, while the most bearish prices it at kr110. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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. For example, we noticed that Atea's rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 9.1% growth to the end of 2024 on an annualised basis. That is well above its historical decline of 2.7% a year over the past five years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 7.9% annually. So it looks like Atea is expected to grow at about the same rate as the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Atea. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. The consensus price target held steady at kr153, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Atea going out to 2026, and you can see them free on our platform here..

Even so, be aware that Atea is showing 1 warning sign in our investment analysis , 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.

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