Earnings Miss: Kimball Electronics, Inc. Missed EPS By 47% And Analysts Are Revising Their Forecasts

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It's been a pretty great week for Kimball Electronics, Inc. (NASDAQ:KE) shareholders, with its shares surging 14% to US$20.77 in the week since its latest quarterly results. It looks like a pretty bad result, all things considered. Although revenues of US$374m were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 47% to hit US$0.12 per share. 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. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for Kimball Electronics

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NasdaqGS:KE Earnings and Revenue Growth November 10th 2024

Taking into account the latest results, the four analysts covering Kimball Electronics provided consensus estimates of US$1.49b revenue in 2025, which would reflect a considerable 10.0% decline over the past 12 months. Per-share earnings are expected to shoot up 42% to US$0.74. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$1.49b and earnings per share (EPS) of US$1.09 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.

The consensus price target held steady at US$24.00, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Kimball Electronics, with the most bullish analyst valuing it at US$29.00 and the most bearish at US$20.00 per share. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Kimball Electronics shareholders.

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 would highlight that revenue is expected to reverse, with a forecast 13% annualised decline to the end of 2025. That is a notable change from historical growth of 9.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 7.3% per year. It's pretty clear that Kimball Electronics' revenues are expected to perform substantially worse than the wider industry.

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