Paradox Interactive AB (publ) Just Recorded A 20% EPS Beat: Here's What Analysts Are Forecasting Next

A week ago, Paradox Interactive AB (publ) (STO:PDX) came out with a strong set of full-year numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 4.3% to hit kr2.2b. Paradox Interactive reported statutory earnings per share (EPS) kr5.53, which was a notable 20% above what the analysts had forecast. 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.

See our latest analysis for Paradox Interactive

Taking into account the latest results, the consensus forecast from Paradox Interactive's six analysts is for revenues of kr2.87b in 2025. This reflects a sizeable 30% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 9.5% to kr6.06. Before this earnings report, the analysts had been forecasting revenues of kr2.78b and earnings per share (EPS) of kr5.96 in 2025. There doesn't appear to have been a major change in sentiment following the results, other than the slight bump in revenue estimates.

It may not be a surprise to see thatthe analysts have reconfirmed their price target of kr232, implying that the uplift in revenue is not expected to greatly contribute to Paradox Interactive's valuation in the near term. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Paradox Interactive, with the most bullish analyst valuing it at kr280 and the most bearish at kr155 per share. 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. It's clear from the latest estimates that Paradox Interactive's rate of growth is expected to accelerate meaningfully, with the forecast 30% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 12% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 9.2% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Paradox Interactive is expected to grow much faster than its 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, they also upgraded their revenue estimates, and are forecasting them to grow faster 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.

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 Paradox Interactive going out to 2027, and you can see them free on our platform here.

We also provide an overview of the Paradox Interactive Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, here.

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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.