engcon AB (publ) Just Missed Earnings - But Analysts Have Updated Their Models

The analysts might have been a bit too bullish on engcon AB (publ) (STO:ENGCON B), given that the company fell short of expectations when it released its quarterly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at kr415m, statutory earnings missed forecasts by an incredible 20%, coming in at just kr0.33 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.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Taking into account the latest results, the current consensus from engcon's three analysts is for revenues of kr2.29b in 2026. This would reflect a huge 29% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to bounce 66% to kr2.44. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr2.28b and earnings per share (EPS) of kr2.39 in 2026. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

See our latest analysis for engcon

There's been no major changes to the consensus price target of kr93.33, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values engcon at kr100.00 per share, while the most bearish prices it at kr85.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that engcon's rate of growth is expected to accelerate meaningfully, with the forecast 22% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 3.3% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 4.9% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that engcon is expected to grow much faster than its industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around engcon's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at kr93.33, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on engcon. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for engcon going out to 2027, and you can see them free on our platform here..

You can also see whether engcon is carrying too much debt, and whether its balance sheet is healthy, for free on our 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.