Humble Group AB (publ) Just Missed EPS By 38%: Here's What Analysts Think Will Happen Next

Investors in Humble Group AB (publ) (STO:HUMBLE) had a good week, as its shares rose 2.6% to close at kr9.31 following the release of its first-quarter results. Statutory earnings per share fell badly short of expectations, coming in at kr0.05, some 38% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at kr1.8b. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Humble Group

Taking into account the latest results, the most recent consensus for Humble Group from three analysts is for revenues of kr7.90b in 2024. If met, it would imply a satisfactory 7.7% increase on its revenue over the past 12 months. Humble Group is also expected to turn profitable, with statutory earnings of kr0.51 per share. In the lead-up to this report, the analysts had been modelling revenues of kr7.95b and earnings per share (EPS) of kr0.52 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at kr12.10, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Humble Group at kr14.00 per share, while the most bearish prices it at kr10.20. 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.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Humble Group's revenue growth is expected to slow, with the forecast 10% annualised growth rate until the end of 2024 being well below the historical 70% 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) 5.3% per year. Even after the forecast slowdown in growth, it seems obvious that Humble Group is also expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Humble Group. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at kr12.10, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Humble Group going out to 2026, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 1 warning sign for Humble Group 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.