Mentice AB (publ) (STO:MNTC) First-Quarter Results: Here's What Analysts Are Forecasting For This Year

Mentice AB (publ) (STO:MNTC) missed earnings with its latest first-quarter results, disappointing overly-optimistic forecasters. Unfortunately, Mentice delivered a serious earnings miss. Revenues of kr54m were 16% below expectations, and statutory losses ballooned 172% to kr1.08 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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Following last week's earnings report, Mentice's four analysts are forecasting 2025 revenues to be kr301.0m, approximately in line with the last 12 months. Earnings are expected to improve, with Mentice forecast to report a statutory profit of kr0.65 per share. Before this earnings report, the analysts had been forecasting revenues of kr341.0m and earnings per share (EPS) of kr0.46 in 2025. So there's been quite a change-up of views after the latest results, with the analysts making a serious cut to their revenue forecasts while also granting a sizeable expansion in to the earnings per share numbers.

Check out our latest analysis for Mentice

There's been no real change to the average price target of kr41.13, with the lower revenue and higher earnings forecasts not expected to meaningfully impact the company's valuation over a longer timeframe. 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 Mentice analyst has a price target of kr58.00 per share, while the most pessimistic values it at kr26.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Mentice's revenue growth is expected to slow, with the forecast 0.07% annualised growth rate until the end of 2025 being well below the historical 16% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 14% annually. Factoring in the forecast slowdown in growth, it seems obvious that Mentice is also expected to grow slower than other industry participants.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Mentice's earnings potential next year. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Even so, earnings per share are more important to the intrinsic value of the business. 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 Mentice going out to 2027, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Mentice , and understanding it should be part of your investment process.

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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.