Addnode Group AB (publ) Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions

Addnode Group AB (publ) (STO:ANOD B) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Statutory earnings performance was extremely strong, with revenue of kr1.6b beating expectations by 24% and earnings per share (EPS) of kr0.77, an impressive 71%ahead of expectations. Following the result, the analyst has 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 analyst latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the current consensus from Addnode Group's single analyst is for revenues of kr6.25b in 2023, which would reflect a solid 12% increase on its sales over the past 12 months. Per-share earnings are expected to rise 6.0% to kr2.85. Before this earnings report, the analyst had been forecasting revenues of kr6.25b and earnings per share (EPS) of kr2.85 in 2023. The consensus analyst doesn'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.

There were no changes to revenue or earnings estimates or the price target of kr100.00, suggesting that the company has met expectations in its recent result.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Addnode Group's revenue growth is expected to slow, with the forecast 9.9% annualised growth rate until the end of 2023 being well below the historical 13% 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) 8.3% annually. Factoring in the forecast slowdown in growth, it looks like Addnode Group is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analyst holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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 analyst estimates for Addnode Group going out as far as 2024, and you can see them free on our platform here.

It might also be worth considering whether Addnode Group's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, 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.