Earnings Miss: Netel Holding AB (publ) Missed EPS By 47% And Analysts Are Revising Their Forecasts

It's been a pretty great week for Netel Holding AB (publ) (STO:NETEL) shareholders, with its shares surging 11% to kr20.05 in the week since its latest quarterly results. Revenue of kr927m surpassed estimates by 2.3%, although statutory earnings per share missed badly, coming in 47% below expectations at kr0.22 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Netel Holding

After the latest results, the twin analysts covering Netel Holding are now predicting revenues of kr3.66b in 2024. If met, this would reflect an okay 2.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 57% to kr1.68. Before this earnings report, the analysts had been forecasting revenues of kr3.67b and earnings per share (EPS) of kr1.97 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a substantial drop in EPS estimates.

Despite cutting their earnings forecasts,the analysts have lifted their price target 14% to kr28.50, suggesting that these impacts are not expected to weigh on the stock's value in the long term.

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. It's pretty clear that there is an expectation that Netel Holding's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 5.8% growth on an annualised basis. This is compared to a historical growth rate of 16% over the past three years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 5.9% annually. Factoring in the forecast slowdown in growth, it looks like Netel Holding is forecast 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 Netel Holding. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Netel Holding. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Netel Holding going out as far as 2026, and you can see them free on our platform here.

Even so, be aware that Netel Holding is showing 3 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

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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