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Camtek Ltd. (NASDAQ:CAMT) shareholders are probably feeling a little disappointed, since its shares fell 2.7% to US$17.85 in the week after its latest third-quarter results. It was a pretty mixed result, with revenues beating expectations to hit US$40m. Statutory earnings fell 8.2% short of analyst forecasts, reaching US$0.15 per share. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the most recent consensus for Camtek from three analysts is for revenues of US$161.3m in 2021 which, if met, would be a notable 15% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 46% to US$0.70. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$156.5m and earnings per share (EPS) of US$0.68 in 2021. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 11% to US$21.00per share. 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 Camtek at US$24.00 per share, while the most bearish prices it at US$18.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's clear from the latest estimates that Camtek's rate of growth is expected to accelerate meaningfully, with the forecast 15% revenue growth noticeably faster than its historical growth of 11%p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 9.6% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Camtek is expected to grow much faster than its industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Camtek's earnings potential next year. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
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. We have forecasts for Camtek going out to 2022, and you can see them free on our platform here.
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
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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