Earnings Miss: ASSA ABLOY AB (publ) Missed EPS By 10.0% And Analysts Are Revising Their Forecasts

It's been a good week for ASSA ABLOY AB (publ) (STO:ASSA B) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.5% to kr283. Revenues of kr38b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at kr2.21, missing estimates by 10.0%. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Taking into account the latest results, ASSA ABLOY's 18 analysts currently expect revenues in 2025 to be kr154.3b, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 3.3% to kr13.62. In the lead-up to this report, the analysts had been modelling revenues of kr157.7b and earnings per share (EPS) of kr14.74 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

See our latest analysis for ASSA ABLOY

The analysts made no major changes to their price target of kr336, suggesting the downgrades are not expected to have a long-term impact on ASSA ABLOY'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 ASSA ABLOY, with the most bullish analyst valuing it at kr412 and the most bearish at kr266 per share. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that ASSA ABLOY's revenue growth is expected to slow, with the forecast 1.2% annualised growth rate until the end of 2025 being well below the historical 13% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.5% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than ASSA ABLOY.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for ASSA ABLOY. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. 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.

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 ASSA ABLOY going out to 2027, and you can see them free on our platform here..

Even so, be aware that ASSA ABLOY 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.