Earnings Miss: Delta Electronics, Inc. Missed EPS By 9.9% And Analysts Are Revising Their Forecasts

Investors in Delta Electronics, Inc. (TWSE:2308) had a good week, as its shares rose 4.0% to close at NT$328 following the release of its first-quarter results. It looks like the results were a bit of a negative overall. While revenues of NT$91b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 9.9% to hit NT$2.21 per share. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Delta Electronics after the latest results.

See our latest analysis for Delta Electronics

After the latest results, the 15 analysts covering Delta Electronics are now predicting revenues of NT$428.7b in 2024. If met, this would reflect an okay 7.3% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to accumulate 6.0% to NT$13.15. Yet prior to the latest earnings, the analysts had been anticipated revenues of NT$437.5b and earnings per share (EPS) of NT$13.22 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The consensus has reconfirmed its price target of NT$356, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Delta Electronics' market value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Delta Electronics, with the most bullish analyst valuing it at NT$430 and the most bearish at NT$297 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Delta Electronics'historical trends, as the 9.8% annualised revenue growth to the end of 2024 is roughly in line with the 11% annual growth over the past five years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 11% per year. So although Delta Electronics is expected to maintain its revenue growth rate, it's only growing at about the rate of the wider 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. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at NT$356, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Delta Electronics. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Delta Electronics going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Delta Electronics has 1 warning sign we think you should be aware of.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.