Inventec Corporation (TWSE:2356) Just Reported Annual Earnings: Have Analysts Changed Their Mind On The Stock?

Last week, you might have seen that Inventec Corporation (TWSE:2356) released its full-year result to the market. The early response was not positive, with shares down 2.0% to NT$46.00 in the past week. It was a workmanlike result, with revenues of NT$646b coming in 3.6% ahead of expectations, and statutory earnings per share of NT$2.03, in line with analyst appraisals. 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.

See our latest analysis for Inventec

After the latest results, the nine analysts covering Inventec are now predicting revenues of NT$695.9b in 2025. If met, this would reflect a credible 7.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 23% to NT$2.50. Before this earnings report, the analysts had been forecasting revenues of NT$692.7b and earnings per share (EPS) of NT$2.69 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at NT$50.50, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Inventec analyst has a price target of NT$61.00 per share, while the most pessimistic values it at NT$38.00. 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.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Inventec's past performance and to peers in the same industry. The analysts are definitely expecting Inventec's growth to accelerate, with the forecast 7.7% annualised growth to the end of 2025 ranking favourably alongside historical growth of 3.1% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 18% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Inventec is expected to grow slower than the wider 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 plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Inventec. 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 Inventec going out to 2027, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 3 warning signs with Inventec (at least 2 which are significant) , and understanding them should be part of your investment process.

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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.