Stock Analysis

IMAX Corporation Just Recorded A 12% EPS Beat: Here's What Analysts Are Forecasting Next

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It's been a pretty great week for IMAX Corporation (NYSE:IMAX) shareholders, with its shares surging 13% to US$17.13 in the week since its latest yearly results. Revenues were US$375m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$0.46 were also better than expected, beating analyst predictions by 12%. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on IMAX after the latest results.

Check out our latest analysis for IMAX

NYSE:IMAX Earnings and Revenue Growth March 1st 2024

Taking into account the latest results, IMAX's eleven analysts currently expect revenues in 2024 to be US$380.7m, approximately in line with the last 12 months. Statutory earnings per share are predicted to increase 8.6% to US$0.53. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$380.4m and earnings per share (EPS) of US$0.52 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$21.95, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic IMAX analyst has a price target of US$25.50 per share, while the most pessimistic values it at US$14.00. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. From these estimates it looks as though the analysts expect the years of declining revenue to come to an end, given the flat forecast out to 2024. That would be a definite improvement, given that the past five years have seen revenue shrink 0.8% annually. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 7.8% annually. Although IMAX's revenues are expected to improve, it seems that it is still expected to grow slower than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards IMAX following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that IMAX's revenue is expected to perform worse 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.

With that in mind, we wouldn't be too quick to come to a conclusion on IMAX. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple IMAX analysts - going out to 2026, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with IMAX .

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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.