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

Nolato AB (publ) (STO:NOLA B) shareholders are probably feeling a little disappointed, since its shares fell 7.5% to kr47.04 in the week after its latest full-year results. Revenues were in line with forecasts, at kr9.5b, although statutory earnings per share came in 13% below what the analysts expected, at kr1.61 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Nolato

Taking into account the latest results, Nolato's four analysts currently expect revenues in 2024 to be kr9.70b, approximately in line with the last 12 months. Statutory earnings per share are predicted to bounce 49% to kr2.41. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr9.85b and earnings per share (EPS) of kr2.48 in 2024. 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 kr53.75, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 Nolato, with the most bullish analyst valuing it at kr57.00 and the most bearish at kr51.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

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. We would highlight that Nolato's revenue growth is expected to slow, with the forecast 1.6% annualised growth rate until the end of 2024 being well below the historical 7.2% 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 5.3% per year. Factoring in the forecast slowdown in growth, it seems obvious that Nolato is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Nolato. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Nolato's revenue is expected to perform worse than the wider industry. The consensus price target held steady at kr53.75, 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 Nolato going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Nolato has 1 warning sign we think you should be aware of.

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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.