G5 Entertainment AB (publ) Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

The analysts might have been a bit too bullish on G5 Entertainment AB (publ) (STO:G5EN), given that the company fell short of expectations when it released its quarterly results last week. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at kr232m, statutory earnings missed forecasts by an incredible 66%, coming in at just kr0.88 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the current consensus, from the two analysts covering G5 Entertainment, is for revenues of kr976.0m in 2025. This implies a small 6.3% reduction in G5 Entertainment's revenue over the past 12 months. Statutory earnings per share are forecast to plummet 30% to kr6.90 in the same period. Before this earnings report, the analysts had been forecasting revenues of kr1.04b and earnings per share (EPS) of kr10.15 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

View our latest analysis for G5 Entertainment

It'll come as no surprise then, to learn that the analysts have cut their price target 5.9% to kr200.

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. One more thing stood out to us about these estimates, and it's the idea that G5 Entertainment's decline is expected to accelerate, with revenues forecast to fall at an annualised rate of 12% to the end of 2025. This tops off a historical decline of 3.5% a year over the past five years. Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 12% annually. So while a broad number of companies are forecast to grow, unfortunately G5 Entertainment is expected to see its revenue affected worse than other companies in the industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2027, which can be seen for 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 G5 Entertainment 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.