Analysts Have Made A Financial Statement On AAK AB (publ.)'s (STO:AAK) Second-Quarter Report

AAK AB (publ.) (STO:AAK) shareholders are probably feeling a little disappointed, since its shares fell 4.0% to kr297 in the week after its latest quarterly results. It looks like the results were a bit of a negative overall. While revenues of kr11b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 3.4% to hit kr3.10 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

See our latest analysis for AAK AB (publ.)

Following last week's earnings report, AAK AB (publ.)'s seven analysts are forecasting 2024 revenues to be kr45.2b, approximately in line with the last 12 months. Statutory per share are forecast to be kr13.36, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr44.3b and earnings per share (EPS) of kr13.62 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.

There were no changes to revenue or earnings estimates or the price target of kr314, suggesting that the company has met expectations in its recent result. 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 AAK AB (publ.), with the most bullish analyst valuing it at kr400 and the most bearish at kr236 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await AAK AB (publ.) shareholders.

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 AAK AB (publ.)'s revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 2.5% growth on an annualised basis. This is compared to a historical growth rate of 14% 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) 2.3% annually. So it's pretty clear that, while AAK AB (publ.)'s revenue growth is expected to slow, it's expected to grow roughly in line with the 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. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for AAK AB (publ.) going out to 2026, and you can see them free on our platform here.

It might also be worth considering whether AAK AB (publ.)'s debt load is appropriate, using our debt analysis tools on the Simply Wall St 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com