Results: N-able, Inc. Exceeded Expectations And The Consensus Has Updated Its Estimates
Last week saw the newest yearly earnings release from N-able, Inc. (NYSE:NABL), an important milestone in the company's journey to build a stronger business. It looks like a credible result overall - although revenues of US$422m were what the analysts expected, N-able surprised by delivering a (statutory) profit of US$0.13 per share, an impressive 27% above what was forecast. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for N-able
Taking into account the latest results, the current consensus from N-able's five analysts is for revenues of US$463.4m in 2024. This would reflect a notable 9.8% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to surge 41% to US$0.18. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$465.4m and earnings per share (EPS) of US$0.16 in 2024. Although the revenue estimates have not really changed, we can see there's been a nice increase in earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target was unchanged at US$15.50, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on N-able, with the most bullish analyst valuing it at US$17.00 and the most bearish at US$14.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of N-able'shistorical trends, as the 9.8% annualised revenue growth to the end of 2024 is roughly in line with the 11% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 12% annually. So although N-able is expected to maintain its revenue growth rate, it's forecast to grow slower 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 N-able following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that N-able's revenue is expected to perform worse than the wider industry. The consensus price target held steady at US$15.50, with the latest estimates not enough to have an impact on their price targets.
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 N-able going out to 2026, and you can see them free on our platform here..
It might also be worth considering whether N-able's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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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.
