Yahoo Finance Flux Power Holdings, Inc. (NASDAQ:FLUX) Consensus Forecasts Have Become A Little Darker Since Its Latest Report
As you might know, Flux Power Holdings, Inc. (NASDAQ:FLUX) just kicked off its latest second-quarter results with some very strong numbers. Revenues and losses per share were both better than expected, with revenues of US$18m leading estimates by 3.0%. Statutory losses were smaller than the analystsexpected, coming in at US$0.05 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 Flux Power Holdings
Following last week's earnings report, Flux Power Holdings' five analysts are forecasting 2024 revenues to be US$62.7m, approximately in line with the last 12 months. Statutory losses are forecast to narrow 3.8% to US$0.44 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$67.1m and earnings per share (EPS) of US$0.045 in 2024. The analysts have made an abrupt about-face on Flux Power Holdings, administering a minor downgrade to to revenue forecasts and slashing the earnings outlook from a profit to loss.
The consensus price target fell 21% to US$9.00, with the analysts clearly concerned about the company following the weaker revenue and earnings outlook. 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. There are some variant perceptions on Flux Power Holdings, with the most bullish analyst valuing it at US$15.00 and the most bearish at US$6.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 3.5% annualised decline to the end of 2024. That is a notable change from historical growth of 39% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 7.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Flux Power Holdings is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that the analysts are expecting Flux Power Holdings to become unprofitable next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Flux Power Holdings going out to 2026, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 3 warning signs for Flux Power Holdings you should be aware of, and 1 of them doesn't sit too well with us.
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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.
