Mentice AB (publ) Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

Shareholders of Mentice AB (publ) (STO:MNTC) will be pleased this week, given that the stock price is up 14% to kr34.60 following its latest quarterly results. Revenues of 39% beat expectations by kr101m and was sufficient to generate a statutory profit of kr0.67 - a pleasant surprise given that the analysts were forecasting a loss! 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Mentice

Following the latest results, Mentice's three analysts are now forecasting revenues of kr315.3m in 2024. This would be a notable 12% improvement in revenue compared to the last 12 months. Losses are predicted to fall substantially, shrinking 55% to kr0.18. Before this earnings announcement, the analysts had been modelling revenues of kr288.0m and losses of kr0.45 per share in 2024. So it seems there's been a definite increase in optimism about Mentice's future following the latest consensus numbers, with a very promising decrease in the loss per share forecasts in particular.

It will come as no surprise to learn thatthe analysts have increased their price target for Mentice 5.9% to kr47.67on the back of these upgrades. 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. There are some variant perceptions on Mentice, with the most bullish analyst valuing it at kr63.00 and the most bearish at kr36.00 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 Mentice shareholders.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Mentice's growth to accelerate, with the forecast 26% annualised growth to the end of 2024 ranking favourably alongside historical growth of 15% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 14% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Mentice to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Mentice. 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 Mentice going out to 2026, and you can see them free on our platform here..

We don't want to rain on the parade too much, but we did also find 1 warning sign for Mentice that you need to be mindful 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.

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