Analysts Are Updating Their Troax Group AB (publ) (STO:TROAX) Estimates After Its Third-Quarter Results

The third-quarter results for Troax Group AB (publ) (STO:TROAX) were released last week, making it a good time to revisit its performance. Results were roughly in line with estimates, with revenues of €64m and statutory earnings per share of €0.12. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Taking into account the latest results, the consensus forecast from Troax Group's four analysts is for revenues of €276.5m in 2026. This reflects a reasonable 3.2% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 68% to €0.61. In the lead-up to this report, the analysts had been modelling revenues of €280.1m and earnings per share (EPS) of €0.62 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

See our latest analysis for Troax Group

The consensus price target held steady at kr191, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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. The most optimistic Troax Group analyst has a price target of kr201 per share, while the most pessimistic values it at kr182. So we wouldn't be assigning too much credibility to analyst price targets in this case, because there are clearly some widely different views on what kind of performance this business can generate. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

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. We would highlight that Troax Group's revenue growth is expected to slow, with the forecast 2.5% annualised growth rate until the end of 2026 being well below the historical 7.4% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 4.9% annually. Factoring in the forecast slowdown in growth, it seems obvious that Troax Group 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 Troax Group. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at kr191, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Troax Group going out to 2027, and you can see them free on our 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.