iRobot Corporation (NASDAQ:IRBT) investors will be delighted, with the company turning in some strong numbers with its latest results. Statutory revenue and earnings both blasted past expectations, with revenue of US$413m beating expectations by 31% and earnings per share (EPS) reaching US$3.27, some 376% ahead of expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on iRobot after the latest results.
Taking into account the latest results, the current consensus from iRobot's seven analysts is for revenues of US$1.47b in 2021, which would reflect a meaningful 12% increase on its sales over the past 12 months. Statutory earnings per share are expected to tumble 76% to US$1.29 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.33b and earnings per share (EPS) of US$0.94 in 2021. So we can see there's been a pretty clear increase in sentiment following the latest results, with both revenues and earnings per share receiving a decent lift in the latest estimates.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 12% to US$92.20per share. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic iRobot analyst has a price target of US$100.00 per share, while the most pessimistic values it at US$78.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting iRobot is an easy business to forecast or the the analysts are all using similar assumptions.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that iRobot's revenue growth will slow down substantially, with revenues next year expected to grow 12%, compared to a historical growth rate of 17% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 9.4% next year. Even after the forecast slowdown in growth, it seems obvious that iRobot is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards iRobot following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for iRobot going out to 2022, and you can see them free on our platform here..
You should always think about risks though. Case in point, we've spotted 1 warning sign for iRobot you should be aware of.
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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