Earnings Beat: Sono-Tek Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Sono-Tek Corporation (NASDAQ:SOTK) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 3.8% to hit US$5.7m. Sono-Tek also reported a statutory profit of US$0.04, which was an impressive 60% above what the analysts had forecast. 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.
View our latest analysis for Sono-Tek
Taking into account the latest results, the most recent consensus for Sono-Tek from dual analysts is for revenues of US$22.7m in 2025. If met, it would imply a major 22% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 23% to US$0.10. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$22.6m and earnings per share (EPS) of US$0.10 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
There's been no major changes to the consensus price target of US$9.88, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation.
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. It's clear from the latest estimates that Sono-Tek's rate of growth is expected to accelerate meaningfully, with the forecast 17% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 6.8% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.2% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Sono-Tek to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Sono-Tek's earnings potential next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Sono-Tek. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Sono-Tek going out as far as 2026, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 3 warning signs for Sono-Tek (1 can't be ignored!) that you should be aware of.
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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.
