Analysts Are Updating Their ITAB Group AB (publ) (STO:ITAB) Estimates After Its Third-Quarter Results
Last week, you might have seen that ITAB Group AB (publ) (STO:ITAB) released its third-quarter result to the market. The early response was not positive, with shares down 2.3% to kr15.16 in the past week. The results don't look great, especially considering that statutory losses grew 27% tokr0.29 per share. Revenues of kr3.4b did beat expectations by 2.6%, but it looks like a bit of a cold comfort. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
Taking into account the latest results, the consensus forecast from ITAB Group's dual analysts is for revenues of kr13.8b in 2027. This reflects a credible 6.5% improvement in revenue compared to the last 12 months. Per-share earnings are expected to jump 1,662% to kr2.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of kr13.9b and earnings per share (EPS) of kr2.37 in 2027. 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.
See our latest analysis for ITAB Group
The consensus price target held steady at kr22.50, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that ITAB Group's revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 5.2% growth on an annualised basis. This is compared to a historical growth rate of 17% over the past five years. Compare this to the 19 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 6.0% per year. Factoring in the forecast slowdown in growth, it looks like ITAB Group is forecast to grow at about the same rate as 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 ITAB Group. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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. At least one analyst has provided forecasts out to 2028, which can be seen for 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 ITAB Group that you need to be mindful of.
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