Inventec Corporation Just Missed EPS By 12%: Here's What Analysts Think Will Happen Next

It's been a good week for Inventec Corporation (TWSE:2356) shareholders, because the company has just released its latest quarterly results, and the shares gained 7.6% to NT$47.55. Statutory earnings per share of NT$0.50 unfortunately missed expectations by 12%, although it was encouraging to see revenues of NT$154b exceed expectations by 5.5%. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Inventec

After the latest results, the eight analysts covering Inventec are now predicting revenues of NT$591.0b in 2024. If met, this would reflect a modest 7.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 27% to NT$2.39. Before this earnings report, the analysts had been forecasting revenues of NT$584.9b and earnings per share (EPS) of NT$2.40 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at NT$56.15. 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. Currently, the most bullish analyst values Inventec at NT$63.00 per share, while the most bearish prices it at NT$45.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Inventec's growth to accelerate, with the forecast 16% annualised growth to the end of 2024 ranking favourably alongside historical growth of 1.6% per annum 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 20% per year. So it's clear that despite the acceleration in growth, Inventec is expected to grow meaningfully slower than the industry average.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Inventec's revenue is expected to perform worse than the wider industry. The consensus price target held steady at NT$56.15, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Inventec going out to 2026, and you can see them free on our platform here..

Even so, be aware that Inventec is showing 1 warning sign in our investment analysis , 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.