Earnings Miss: Hudson Global, Inc. Missed EPS By 61% And Analysts Are Revising Their Forecasts

Hudson Global, Inc. (NASDAQ:HSON) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasts. It looks like quite a negative result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of US$39m missed by 13%, and statutory earnings per share of US$0.17 fell short of forecasts by 61%. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimate to see what could be in store for next year.

Check out our latest analysis for Hudson Global

Following last week's earnings report, Hudson Global's single analyst are forecasting 2024 revenues to be US$172.0m, approximately in line with the last 12 months. Per-share earnings are expected to surge 118% to US$1.18. Yet prior to the latest earnings, the analyst had been anticipated revenues of US$203.3m and earnings per share (EPS) of US$2.44 in 2024. It looks like sentiment has declined substantially in the aftermath of these results, with a substantial drop in revenue estimates and a pretty serious reduction to earnings per share numbers as well.

The consensus price target fell 14% to US$31.00, with the weaker earnings outlook clearly leading valuation estimates.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Hudson Global's past performance and to peers in the same industry. We would highlight that Hudson Global's revenue growth is expected to slow, with the forecast 0.5% annualised growth rate until the end of 2024 being well below the historical 23% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.5% annually. Factoring in the forecast slowdown in growth, it seems obvious that Hudson Global is also expected to grow slower than other industry participants.

The Bottom Line

The biggest concern is that the analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Hudson Global. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target fell measurably, with the analyst seemingly not reassured by the latest results, leading to a lower estimate of Hudson Global's future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Hudson Global that you should be aware 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.