Axfood AB (publ) (STO:AXFO) Just Released Its Yearly Earnings: Here's What Analysts Think

It's been a pretty great week for Axfood AB (publ) (STO:AXFO) shareholders, with its shares surging 11% to kr289 in the week since its latest annual results. Results were roughly in line with estimates, with revenues of kr81b and statutory earnings per share of kr10.87. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Axfood

Following the latest results, Axfood's five analysts are now forecasting revenues of kr84.6b in 2024. This would be a credible 4.3% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 14% to kr12.47. Before this earnings report, the analysts had been forecasting revenues of kr84.8b and earnings per share (EPS) of kr12.42 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at kr286. 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 Axfood analyst has a price target of kr320 per share, while the most pessimistic values it at kr245. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Axfood's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.3% growth on an annualised basis. This is compared to a historical growth rate of 12% 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) 5.2% annually. Factoring in the forecast slowdown in growth, it looks like Axfood is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Axfood. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Axfood going out to 2026, and you can see them free on our platform here..

We also provide an overview of the Axfood Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.