Earnings Miss: Afry AB Missed EPS By 54% And Analysts Are Revising Their Forecasts

Afry AB (STO:AFRY) just released its latest quarterly report and things are not looking great. Results showed a clear earnings miss, with kr6.7b revenue coming in 3.3% lower than what the analystsexpected. Statutory earnings per share (EPS) of kr1.71 missed the mark badly, arriving some 54% below what was expected. 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.

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Following last week's earnings report, Afry's five analysts are forecasting 2025 revenues to be kr26.5b, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 8.1% to kr8.98. In the lead-up to this report, the analysts had been modelling revenues of kr26.9b and earnings per share (EPS) of kr10.58 in 2025. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

See our latest analysis for Afry

It might be a surprise to learn that the consensus price target was broadly unchanged at kr214, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on 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 Afry at kr240 per share, while the most bearish prices it at kr165. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

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 Afry's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 0.1% growth on an annualised basis. This is compared to a historical growth rate of 8.8% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 4.7% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Afry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Afry. 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 kr214, 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 Afry going out to 2027, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 1 warning sign for Afry 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.