XPEL, Inc. Just Missed EPS By 6.9%: Here's What Analysts Think Will Happen Next
Investors in XPEL, Inc. (NASDAQ:XPEL) had a good week, as its shares rose 3.9% to close at US$65.34 following the release of its yearly results. It looks like the results were a bit of a negative overall. While revenues of US$259m were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 6.9% to hit US$1.14 per share. 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.
View our latest analysis for XPEL
After the latest results, the two analysts covering XPEL are now predicting revenues of US$321.1m in 2022. If met, this would reflect a huge 24% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to bounce 34% to US$1.53. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$324.1m and earnings per share (EPS) of US$1.72 in 2022. So there's definitely been a decline in sentiment after the latest results, noting the substantial drop in new EPS forecasts.
It might be a surprise to learn that the consensus price target fell 9.1% to US$100.00, with the analysts clearly linking lower forecast earnings to the performance of the stock price.
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 XPEL'shistorical trends, as the 24% annualised revenue growth to the end of 2022 is roughly in line with the 30% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 16% annually. So although XPEL is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for XPEL. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. 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.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for XPEL going out as far as 2023, and you can see them free on our platform here.
You still need to take note of risks, for example - XPEL 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.
