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Investors in Amkor Technology, Inc. (NASDAQ:AMKR) had a good week, as its shares rose 9.8% to close at US$12.99 following the release of its full-year results. It looks like a credible result overall - although revenues of US$4.1b were what analysts expected, Amkor Technology surprised by delivering a (statutory) profit of US$0.50 per share, an impressive 54% above what analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what top analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the most recent consensus for Amkor Technology from two analysts is for revenues of US$4.65b in 2020, which is a notable 15% increase on its sales over the past 12 months. Statutory earnings per share are expected to bounce 94% to US$0.98. Before this earnings report, analysts had been forecasting revenues of US$4.39b and earnings per share (EPS) of US$0.69 in 2020. So it seems there's been a definite increase in optimism about Amkor Technology's future following the latest results, with a sizeable expansion in the earnings per share forecasts in particular.
It will come as no surprise to learn that analysts have increased their price target for Amkor Technology 15% to US$13.75 on the back of these upgrades.
Zooming out to look at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up both against past performance, and against industry growth estimates. Analysts are definitely expecting Amkor Technology's growth to accelerate, with the forecast 15% growth ranking favourably alongside historical growth of 7.5% per annum over the past five years. Compare this with other companies in the same market, which are forecast to grow their revenue 8.9% next year. Factoring in the forecast acceleration in revenue, it's pretty clear that Amkor Technology is expected to grow much faster than its market.
The Bottom Line
The most important thing to take away from this is that analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Amkor Technology following these results. Fortunately, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
Still, the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for Amkor Technology going out as far as 2022, and you can see them free on our platform here.
You can also view our analysis of Amkor Technology's balance sheet, and whether we think Amkor Technology is carrying too much debt, for free on our platform here.
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