Earnings Beat: Surgical Science Sweden AB (publ) Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

Surgical Science Sweden AB (publ) (STO:SUS) shareholders are probably feeling a little disappointed, since its shares fell 4.1% to kr145 in the week after its latest full-year results. Revenues kr883m disappointed slightly, at4.5% below what the analysts had predicted. Profits were a relative bright spot, with statutory per-share earnings of kr4.59 coming in 20% above what was anticipated. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for Surgical Science Sweden

After the latest results, the six analysts covering Surgical Science Sweden are now predicting revenues of kr999.4m in 2024. If met, this would reflect a solid 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to reduce 9.1% to kr4.17 in the same period. In the lead-up to this report, the analysts had been modelling revenues of kr1.01b and earnings per share (EPS) of kr4.24 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.

The analysts reconfirmed their price target of kr222, showing that the business is executing well and in line with expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Surgical Science Sweden analyst has a price target of kr260 per share, while the most pessimistic values it at kr165. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Surgical Science Sweden's revenue growth is expected to slow, with the forecast 13% annualised growth rate until the end of 2024 being well below the historical 54% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 13% annually. So it's pretty clear that, while Surgical Science Sweden's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Surgical Science Sweden. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Surgical Science Sweden analysts - going out to 2026, and you can see them free on our platform here.

You can also see our analysis of Surgical Science Sweden's Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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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.