Results: UFP Technologies, Inc. Beat Earnings Expectations And Analysts Now Have New Forecasts
Shareholders might have noticed that UFP Technologies, Inc. (NASDAQ:UFPT) filed its second-quarter result this time last week. The early response was not positive, with shares down 2.4% to US$187 in the past week. The result was positive overall - although revenues of US$100m were in line with what the analysts predicted, UFP Technologies surprised by delivering a statutory profit of US$1.55 per share, modestly greater than expected. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Check out our latest analysis for UFP Technologies
Taking into account the latest results, the most recent consensus for UFP Technologies from twin analysts is for revenues of US$397.4m in 2023. If met, it would imply a satisfactory 3.0% increase on its revenue over the past 12 months. Statutory earnings per share are expected to descend 13% to US$5.69 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$393.6m and earnings per share (EPS) of US$5.50 in 2023. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 13% to US$223.
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. We would highlight that UFP Technologies' revenue growth is expected to slow, with the forecast 6.0% annualised growth rate until the end of 2023 being well below the historical 16% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.9% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than UFP Technologies.
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 UFP Technologies 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 UFP Technologies' revenue is expected to perform worse 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 in mind, we wouldn't be too quick to come to a conclusion on UFP Technologies. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2024, which can be seen for free on our platform here.
You still need to take note of risks, for example - UFP Technologies has 1 warning sign we think 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.
