One of last week’s biggest stories was Data #3 limited (ASX:DTL)’s share price has plunged 22% in the week since its latest half-year results, closing at A$7.69 yesterday. Data #3 reported revenue of AU$1.3 billion, roughly in line with analyst expectations, but statutory earnings per share (EPS) of AU$0.14, 3.0% above analyst expectations. The results exceeded expectations. Analysts typically update their forecasts with each earnings report, and we can use their forecasts to determine whether their view of the company has changed or if there are any new concerns to be aware of. . Readers will be pleased to see we’ve aggregated the latest statutory forecasts to see if the analysts have changed their mind on data #3 following the latest results.
Check out our latest analysis for Data #3.
Following the latest results, Data#3’s 8 analysts are forecasting revenue of AU$2.85b in 2024. This represents a significant 9.6% improvement in earnings compared to the previous 12 months. Earnings per share are expected to increase by 4.4% to A$0.28. However, before the latest results, analysts had been forecasting revenue of AU$2.87b and earnings per share (EPS) of AU$0.29 in 2024. Next year’s earnings per share figure will be slightly lowered.
You might be surprised to learn that the consensus price target is largely unchanged at AU$8.05, with analysts clearly suggesting that the expected decline in earnings won’t have a material impact on valuation. The consensus price target is just the average of the individual analyst targets, so it’s useful to see how wide the range of underlying forecasts is. The most optimistic analyst for Data #3 has a price target of AU$9.15 per share, while the most pessimistic has a price target of AU$5.50. There are certainly some differing views on the stock price, but in our view the range of estimates is not wide enough to suggest that the situation is unpredictable.
Looking at the bigger picture here, one way to understand these forecasts is to see how they compare to past performance and industry growth forecasts. Analysts definitely expect Data#3’s growth to accelerate, with a forecast of 20% annual growth to the end of 2024, which is on par with its historic 12% annual growth over the past five years. There is. Compare this to other companies in the same industry, whose revenues are expected to grow by 15% per year. Considering the expected earnings acceleration, it’s clear that Data#3 is expected to grow much faster than its industry.
conclusion
Most importantly, the analysts have revised down their earnings per share estimates, indicating a clear drop in sentiment following the results. Fortunately, they also reaffirmed their revenue numbers, suggesting they’re performing in line with expectations. Furthermore, our data suggests that revenue is expected to grow faster than the industry as a whole. The consensus price target remains unchanged at AU$8.05, with the latest forecast not having a significant impact on the target price.
With this in mind, we think the long-term trajectory of the business is far more important for investors to consider. We have his forecasts from multiple Data #3 analysts out to 2026, and you can see them for free on our platform here.
Before you take the next step, you need to know the following: 1 warning sign for data #3 What we discovered.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodologies, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
