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This Analyst Just Wrote A Brand New Outlook For UFP Technologies, Inc.'s (NASDAQ:UFPT) Business

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UFP Technologies, Inc. (NASDAQ:UFPT) shareholders will have a reason to smile today, with the covering analyst making substantial upgrades to this year's statutory forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analyst modelling a real improvement in business performance. The market seems to be pricing in some improvement in the business too, with the stock up 4.8% over the past week, closing at US$72.02. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After this upgrade, UFP Technologies' solitary analyst is now forecasting revenues of US$308m in 2022. This would be a huge 49% improvement in sales compared to the last 12 months. Per-share earnings are expected to bounce 69% to US$3.56. Previously, the analyst had been modelling revenues of US$279m and earnings per share (EPS) of US$3.08 in 2022. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for UFP Technologies

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It will come as no surprise to learn that the analyst has increased their price target for UFP Technologies 11% to US$100.00 on the back of these upgrades.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analyst is definitely expecting UFP Technologies' growth to accelerate, with the forecast 71% annualised growth to the end of 2022 ranking favourably alongside historical growth of 5.9% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect UFP Technologies to grow faster than the wider industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that the analyst upgraded their earnings per share estimates, with improved earnings power expected for this year. Fortunately, the analyst also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, UFP Technologies could be worth investigating further.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for UFP Technologies going out as far as 2023, and you can see them free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.