OFX Group Limited (ASX:OFX) just released its yearly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 4.8% to hit AU$135m. OFX Group also reported a statutory profit of AU$0.051, which was an impressive 34% above what the analyst had forecast. This is an important time for investors, as they can track a company's performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.
Following the latest results, OFX Group's sole analyst are now forecasting revenues of AU$144.6m in 2022. This would be an okay 7.4% improvement in sales compared to the last 12 months. Per-share earnings are expected to soar 22% to AU$0.064. Before this earnings report, the analyst had been forecasting revenues of AU$139.1m and earnings per share (EPS) of AU$0.058 in 2022. There's been a pretty noticeable increase in sentiment, with the analyst upgrading revenues and making a solid gain to earnings per share in particular.
Despite these upgrades,the analyst has not made any major changes to their price target of AU$1.65, suggesting that the higher estimates are not likely to have a long term impact on what the stock is worth.
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. The analyst is definitely expecting OFX Group's growth to accelerate, with the forecast 7.4% annualised growth to the end of 2022 ranking favourably alongside historical growth of 4.5% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 2.4% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analyst also expect OFX Group to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards OFX Group following these results. Happily, they also upgraded their revenue estimates, and are forecasting revenues to grow faster than the wider industry. The consensus price target held steady at AU$1.65, with the latest estimates not enough to have an impact on their price target.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have analyst estimates for OFX Group going out as far as 2024, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for OFX Group you should know about.
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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