Cabka N.V. (AMS:CABKA) Just Reported Earnings, And Analysts Cut Their Target Price

It's been a pretty great week for Cabka N.V. (AMS:CABKA) shareholders, with its shares surging 19% to €5.90 in the week since its latest full-year results. It was an okay result overall, with revenues coming in at €201m, roughly what the analysts had been expecting. 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Cabka

After the latest results, the three analysts covering Cabka are now predicting revenues of €206.2m in 2024. If met, this would reflect a satisfactory 2.5% improvement in revenue compared to the last 12 months. Cabka is also expected to turn profitable, with statutory earnings of €0.15 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of €211.3m and earnings per share (EPS) of €0.11 in 2024. While revenue forecasts have been revised downwards, the analysts look to have become more optimistic on the company's cost base, given the sizeable expansion in to the earnings per share numbers.

The consensus price target fell 5.6% to €7.85, with the analysts signalling that the weaker revenue outlook was a more powerful indicator than the upgraded EPS forecasts. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Cabka at €8.50 per share, while the most bearish prices it at €6.55. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. We would highlight that Cabka's revenue growth is expected to slow, with the forecast 2.5% annualised growth rate until the end of 2024 being well below the historical 12% p.a. growth over the last three years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 3.2% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Cabka.

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 Cabka following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Still, earnings are more important to the intrinsic value of the business. 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 Cabka. Long-term earnings power is much more important than next year's profits. We have forecasts for Cabka going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Cabka you should be aware of.

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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.