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

Last week saw the newest annual earnings release from Momentum Group AB (publ) (STO:MMGR B), an important milestone in the company's journey to build a stronger business. It looks like the results were a bit of a negative overall. While revenues of kr2.9b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 8.1% to hit kr3.60 per share. 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 Momentum Group after the latest results.

View our latest analysis for Momentum Group

After the latest results, the twin analysts covering Momentum Group are now predicting revenues of kr3.08b in 2025. If met, this would reflect a reasonable 7.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to step up 19% to kr4.28. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr3.08b and earnings per share (EPS) of kr4.60 in 2025. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

It might be a surprise to learn that the consensus price target was broadly unchanged at kr190, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Momentum Group's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.1% growth on an annualised basis. This is compared to a historical growth rate of 20% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.1% annually. Factoring in the forecast slowdown in growth, it looks like Momentum Group is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Momentum Group going out as far as 2027, and you can see them free on our platform here.

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

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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.