Results: Paxman AB (publ) Beat Earnings Expectations And Analysts Now Have New Forecasts

Investors in Paxman AB (publ) (STO:PAX) had a good week, as its shares rose 3.1% to close at kr53.20 following the release of its quarterly results. Revenues were kr63m, approximately in line with whatthe analyst expected, although statutory earnings per share (EPS) crushed expectations, coming in at kr0.52, an impressive 73% ahead of estimates. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analyst has changed their mind on Paxman after the latest results.

See our latest analysis for Paxman

Taking into account the latest results, the consensus forecast from Paxman's single analyst is for revenues of kr263.0m in 2024. This reflects an okay 6.0% improvement in revenue compared to the last 12 months. Before this earnings report, the analyst had been forecasting revenues of kr292.0m and earnings per share (EPS) of kr1.80 in 2024. So we can see that while the consensus made a small dip in revenue estimates, it no longer provides an earnings per share estimate. This suggests that the market is now more focused on revenue after the latest result.

There's been no real change to the consensus price target of kr80.00, with Paxman seemingly executing in line with expectations.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Paxman's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Paxman's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 12% growth on an annualised basis. This is compared to a historical growth rate of 24% 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 18% 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 Paxman.

The Bottom Line

The most important thing to take away is that the analyst downgraded their revenue estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply revenues will perform worse 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.

One Paxman broker/analyst has provided estimates out to 2025, which can be seen for free on our platform here.

Even so, be aware that Paxman is showing 1 warning sign in our investment analysis , you should know about...

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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.