Patria Investments Limited (NASDAQ:PAX) Just Beat EPS By 8.1%: Here's What Analysts Are Forecasting For This Year

A week ago, Patria Investments Limited (NASDAQ:PAX) came out with a strong set of yearly numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of US$328m arriving 9.0% ahead of forecasts. Statutory earnings per share (EPS) were US$0.79, 8.1% ahead of estimates. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Patria Investments

Taking into account the latest results, the current consensus from Patria Investments' four analysts is for revenues of US$381.6m in 2024. This would reflect a meaningful 16% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 25% to US$1.00. Before this earnings report, the analysts had been forecasting revenues of US$381.5m and earnings per share (EPS) of US$1.08 in 2024. 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 minor downgrade to their earnings per share forecasts.

The consensus price target held steady at US$19.10, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Patria Investments analyst has a price target of US$23.00 per share, while the most pessimistic values it at US$17.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Patria Investments' revenue growth is expected to slow, with the forecast 16% annualised growth rate until the end of 2024 being well below the historical 23% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 6.6% annually. Even after the forecast slowdown in growth, it seems obvious that Patria Investments is also expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Patria Investments. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.

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. We have forecasts for Patria Investments going out to 2025, 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 1 warning sign for Patria Investments 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.