CPI Card Group Inc. Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

CPI Card Group Inc. (NASDAQ:PMTS) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Results showed a clear earnings miss, with US$106m revenue coming in 7.0% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.33 missed the mark badly, arriving some 33% below what was expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. 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 CPI Card Group

Following the recent earnings report, the consensus from two analysts covering CPI Card Group is for revenues of US$457.1m in 2024. This implies a noticeable 2.4% decline in revenue compared to the last 12 months. Statutory earnings per share are expected to sink 17% to US$2.44 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$511.7m and earnings per share (EPS) of US$3.66 in 2024. Indeed, we can see that the analysts are a lot more bearish about CPI Card Group's prospects following the latest results, administering a real cut to revenue estimates and slashing their EPS estimates to boot.

The consensus price target fell 38% to US$25.00, with the weaker earnings outlook clearly leading valuation estimates.

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 1.9% by the end of 2024. This indicates a significant reduction from annual growth of 15% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.5% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - CPI Card Group 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.

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 analyst estimates for CPI Card Group going out as far as 2024, and you can see them free on our platform here.

Even so, be aware that CPI Card Group is showing 3 warning signs in our investment analysis , and 2 of those can't be ignored...

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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.