IBEX Limited Just Beat EPS By 103%: Here's What Analysts Think Will Happen Next
It's been a good week for IBEX Limited (NASDAQ:IBEX) shareholders, because the company has just released its latest quarterly results, and the shares gained 4.4% to US$19.69. It looks to have been a decent result overall - while revenue fell marginally short of analyst estimates at US$132m, statutory earnings beat expectations by a notable 103%, coming in at US$0.61 per share. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
See our latest analysis for IBEX
Taking into account the latest results, the current consensus from IBEX's five analysts is for revenues of US$567.4m in 2024, which would reflect a notable 8.6% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 50% to US$1.87. Before this earnings report, the analysts had been forecasting revenues of US$601.0m and earnings per share (EPS) of US$1.87 in 2024. The consensus seems maybe a little more pessimistic, trimming their revenue forecasts after the latest results even though there was no change to its EPS estimates.
The average price target was reduced 14% to US$26.80, with the lower revenue forecasts indicating negative sentiment towards IBEX, even though earnings forecasts were unchanged. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic IBEX analyst has a price target of US$32.00 per share, while the most pessimistic values it at US$23.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
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. We would highlight that IBEX's revenue growth is expected to slow, with the forecast 6.8% annualised growth rate until the end of 2024 being well below the historical 9.1% p.a. growth over the last five years. Compare this to the 163 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 7.5% per year. So it's pretty clear that, while IBEX's revenue growth is expected to slow, it's expected to grow roughly in line with the industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Sadly, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the industry itself. With that said, earnings are more important to the long-term value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.
With that in mind, we wouldn't be too quick to come to a conclusion on IBEX. Long-term earnings power is much more important than next year's profits. We have forecasts for IBEX going out to 2025, and you can see them free on our platform here.
You can also see our analysis of IBEX's Board and CEO remuneration and experience, and whether company insiders have been buying stock.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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