Results: Gambling.com Group Limited Exceeded Expectations And The Consensus Has Updated Its Estimates

Gambling.com Group Limited (NASDAQ:GAMB) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Gambling.com Group delivered a significant beat to revenue and earnings per share (EPS) expectations, hitting US$31m-13% above indicated-andUS$0.19-56% above forecasts- respectively This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Gambling.com Group

After the latest results, the seven analysts covering Gambling.com Group are now predicting revenues of US$124.8m in 2024. If met, this would reflect a modest 7.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to rise 9.4% to US$0.77. In the lead-up to this report, the analysts had been modelling revenues of US$120.2m and earnings per share (EPS) of US$0.73 in 2024. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 11% to US$14.29per share. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Gambling.com Group, with the most bullish analyst valuing it at US$18.00 and the most bearish at US$13.00 per share. 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 Gambling.com Group's revenue growth is expected to slow, with the forecast 16% annualised growth rate until the end of 2024 being well below the historical 39% 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 3.4% annually. So it's pretty clear that, while Gambling.com Group's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Gambling.com Group's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting them to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Gambling.com Group going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Gambling.com Group 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.