A week ago, Allied Motion Technologies Inc. (NASDAQ:AMOT) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. The company beat both earnings and revenue forecasts, with revenue of US$95m, some 5.2% above estimates, and statutory earnings per share (EPS) coming in at US$0.42, 57% ahead of expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus from Allied Motion Technologies' three analysts is for revenues of US$391.2m in 2021, which would reflect a notable 8.2% increase on its sales over the past 12 months. Per-share earnings are expected to step up 13% to US$1.72. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$390.0m and earnings per share (EPS) of US$1.73 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
The consensus price target rose 9.8% to US$48.67despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Allied Motion Technologies' earnings by assigning a price premium. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Allied Motion Technologies at US$51.00 per share, while the most bearish prices it at US$46.00. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We would highlight that Allied Motion Technologies' revenue growth is expected to slow, with forecast 8.2% increase next year well below the historical 11%p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.4% next year. So it's pretty clear that, while Allied Motion Technologies' revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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 Simply Wall St, we have a full range of analyst estimates for Allied Motion Technologies going out to 2021, and you can see them free on our platform here..
Before you take the next step you should know about the 1 warning sign for Allied Motion Technologies that we have uncovered.
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. 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.
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