Results: Allgon AB (publ) Beat Earnings Expectations And Analysts Now Have New Forecasts
Allgon AB (publ) (STO:ALLG B) shares fell 5.8% to kr10.60 in the week since its latest yearly results. Revenues were kr575m, approximately in line with what analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at kr0.76, an impressive 21% ahead of estimates. Following the result, 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 analysts have changed their earnings models, following these results.
Check out our latest analysis for Allgon
Taking into account the latest results, the latest consensus from Allgon's one analyst is for revenues of kr648.0m in 2020, which would reflect a notable 13% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to shrink 7.9% to kr0.70 in the same period. In the lead-up to this report, analysts had been modelling revenues of kr643.0m and earnings per share (EPS) of kr0.73 in 2020. Analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share forecasts for next year.
It can be useful to take a broader overview by seeing how analyst forecasts compare, both to the Allgon's past performance and to peers in the same market. We would highlight that Allgon's revenue growth is expected to slow, with forecast 13% increase next year well below the historical 39%p.a. growth over the last five years. By way of comparison, other companies in this market with analyst coverage, are forecast to grow their revenue at 3.3% next year. Even after the forecast slowdown in growth, it seems obvious that analysts still thinkAllgon will grow faster than the wider market.
The Bottom Line
The most important thing to take away is that analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - and our data does suggest that Allgon's revenues are expected to grow faster than the wider market. Analysts have not currently provided a price target, but the market responded negatively to the update with the share price falling -5.8% over the past week.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At least one analyst has provided forecasts out to 2022, which can be seen for free on our platform here.
You can also view our analysis of Allgon's balance sheet, and whether we think Allgon is carrying too much debt, for free on our platform here.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
