Earnings Miss: Vicor Corporation Missed EPS By 10% And Analysts Are Revising Their Forecasts

Vicor Corporation (NASDAQ:VICR) missed earnings with its latest full-year results, disappointing overly-optimistic forecasters. Vicor missed earnings this time around, with US$405m revenue coming in 3.4% below what the analysts had modelled. Statutory earnings per share (EPS) of US$1.19 also fell short of expectations by 10%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

View our latest analysis for Vicor

Taking into account the latest results, the current consensus, from the three analysts covering Vicor, is for revenues of US$349.2m in 2024. This implies an uncomfortable 14% reduction in Vicor's revenue over the past 12 months. Per-share earnings are expected to grow 16% to US$1.40. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$439.6m and earnings per share (EPS) of US$1.45 in 2024. It looks like sentiment has fallen somewhat in the aftermath of these results, with a pretty serious reduction to revenue estimates and a small dip in earnings per share numbers as well.

The consensus price target fell 22% to US$54.00, with the weaker earnings outlook clearly leading valuation estimates. 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. There are some variant perceptions on Vicor, with the most bullish analyst valuing it at US$68.00 and the most bearish at US$40.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Vicor shareholders.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 14% by the end of 2024. This indicates a significant reduction from annual growth of 10% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Vicor is expected to lag 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 negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Vicor going out to 2025, and you can see them free on our platform here..

We also provide an overview of the Vicor Board and CEO remuneration and length of tenure at the company, and whether insiders have been buying the stock, 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.