Kambi Group plc Just Beat EPS By 136%: Here's What Analysts Think Will Happen Next

As you might know, Kambi Group plc (STO:KAMBI) just kicked off its latest second-quarter results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 9.0% to hit €46m. Kambi Group also reported a statutory profit of €0.15, which was an impressive 136% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Kambi Group

Following the latest results, Kambi Group's four analysts are now forecasting revenues of €179.2m in 2024. This would be a credible 2.2% improvement in revenue compared to the last 12 months. Per-share earnings are expected to accumulate 5.6% to €0.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of €175.4m and earnings per share (EPS) of €0.44 in 2024. There's been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a great increase in earnings per share in particular.

Despite these upgrades,the analysts have not made any major changes to their price target of kr187, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Kambi Group at kr244 per share, while the most bearish prices it at kr136. We would probably assign less value to the analyst forecasts in this situation, because such a wide range of estimates could imply that the future of this business is difficult to value accurately. 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.

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 Kambi Group's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.5% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Kambi Group.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Kambi Group's earnings potential next year. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than 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.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Kambi Group going out to 2026, and you can see them free on our platform here.

We also provide an overview of the Kambi Group 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.

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