Earnings Beat: Logitech International S.A. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models
Logitech International S.A. (VTX:LOGN) shareholders are probably feeling a little disappointed, since its shares fell 9.3% to CHF81.66 in the week after its latest quarterly results. Revenues were US$1.2b, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$1.25, an impressive 26% ahead of estimates. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Logitech International after the latest results.
Taking into account the latest results, Logitech International's 16 analysts currently expect revenues in 2027 to be US$4.97b, approximately in line with the last 12 months. Statutory earnings per share are forecast to decline 14% to US$5.09 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$4.89b and earnings per share (EPS) of US$4.97 in 2027. So the consensus seems to have become somewhat more optimistic on Logitech International's earnings potential following these results.
Check out our latest analysis for Logitech International
There's been no major changes to the consensus price target of CHF88.29, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Logitech International at CHF116 per share, while the most bearish prices it at CHF68.79. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
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. From these estimates it looks as though the analysts expect the years of declining revenue to come to an end, given the flat forecast out to 2027. That would be a definite improvement, given that the past five years have seen revenue shrink 3.0% annually. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 12% per year. So it's pretty clear that, although revenues are improving, Logitech International is still expected to grow slower than the industry.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Logitech International's earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
With that in mind, we wouldn't be too quick to come to a conclusion on Logitech International. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Logitech International going out to 2029, and you can see them free on our platform here..
Even so, be aware that Logitech International is showing 1 warning sign in our investment analysis , you should know about...
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