ITEQ Corporation Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

There's been a major selloff in ITEQ Corporation (TWSE:6213) shares in the week since it released its quarterly report, with the stock down 23% to NT$71.90. Revenue of NT$7.6b surpassed estimates by 2.4%, although statutory earnings per share missed badly, coming in 47% below expectations at NT$0.55 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for ITEQ

After the latest results, the seven analysts covering ITEQ are now predicting revenues of NT$30.1b in 2024. If met, this would reflect a notable 11% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 21% to NT$3.05. In the lead-up to this report, the analysts had been modelling revenues of NT$30.4b and earnings per share (EPS) of NT$4.36 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a large cut to EPS estimates.

It might be a surprise to learn that the consensus price target fell 18% to NT$97.16, with the analysts clearly linking lower forecast earnings to the performance of the stock price. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on ITEQ, with the most bullish analyst valuing it at NT$140 and the most bearish at NT$70.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

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. The analysts are definitely expecting ITEQ's growth to accelerate, with the forecast 23% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.4% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that ITEQ is expected to grow much faster than its 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of ITEQ's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple ITEQ analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for ITEQ that you need to be mindful of.

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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.