Vox Royalty Corp. (TSE:VOXR) Just Reported, And Analysts Assigned A CA$5.42 Price Target

Investors in Vox Royalty Corp. (TSE:VOXR) had a good week, as its shares rose 6.0% to close at CA$2.65 following the release of its yearly results. Results were overall in line with expectations, with the company breaking even at the statutory earnings per share (EPS) level on US$12m in revenue. 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 Vox Royalty after the latest results.

See our latest analysis for Vox Royalty

Following last week's earnings report, Vox Royalty's four analysts are forecasting 2024 revenues to be US$12.1m, approximately in line with the last 12 months. Vox Royalty is also expected to turn profitable, with statutory earnings of US$0.033 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$12.7m and earnings per share (EPS) of US$0.03 in 2024. Although the analysts have lowered their revenue forecasts, they've also made a nice gain to their earnings per share estimates, which implies there's been something of an uptick in sentiment following the latest results.

The analysts have cut their price target 5.6% to CA$5.42per share, suggesting that the declining revenue was a more crucial indicator than the expected improvement in earnings. 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 Vox Royalty, with the most bullish analyst valuing it at CA$8.10 and the most bearish at CA$3.99 per share. As you can see the range of estimates is wide, with the lowest valuation coming in at less than half the most bullish estimate, suggesting there are some strongly diverging views on how analysts think this business will perform. With this in mind, we wouldn't rely too heavily the consensus price target, as it is just an average and analysts clearly have some deeply divergent views on the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.7% by the end of 2024. This indicates a significant reduction from annual growth of 68% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 11% annually for the foreseeable future. It's pretty clear that Vox Royalty's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Vox Royalty's earnings potential next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, long term profitability is more important for the value creation process. 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.

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

Plus, you should also learn about the 3 warning signs we've spotted with Vox Royalty (including 1 which is significant) .

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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.