Analysts Have Been Trimming Their XPEL, Inc. (NASDAQ:XPEL) Price Target After Its Latest Report
Last week, you might have seen that XPEL, Inc. (NASDAQ:XPEL) released its full-year result to the market. The early response was not positive, with shares down 5.8% to US$52.98 in the past week. XPEL beat revenue expectations by 2.3%, at US$396m. Statutory earnings per share (EPS) came in at US$1.91, some 2.3% short of analyst estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on XPEL after the latest results.
View our latest analysis for XPEL
Following the latest results, XPEL's twin analysts are now forecasting revenues of US$441.1m in 2024. This would be a solid 11% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to swell 11% to US$2.13. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$434.0m and earnings per share (EPS) of US$2.33 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.
It might be a surprise to learn that the consensus price target fell 31% to US$67.00, with the analysts clearly linking lower forecast earnings to the performance of the stock price.
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. We would highlight that XPEL's revenue growth is expected to slow, with the forecast 11% annualised growth rate until the end of 2024 being well below the historical 28% 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) 9.8% annually. Factoring in the forecast slowdown in growth, it looks like XPEL is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for XPEL. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of XPEL's future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have analyst estimates for XPEL going out as far as 2025, and you can see them free on our platform here.
You can also see whether XPEL is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.
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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.
