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There's been a major selloff in AXT, Inc. (NASDAQ:AXTI) shares in the week since it released its quarterly report, with the stock down 22% to US$2.11. Revenues of US$24m came in 9.0% below estimates, but statutory losses were well contained with a per-share loss of US$0.07 being some 18% smaller than what the analysts were predicting. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on AXT after the latest results.
View our latest analysis for AXT
Taking into account the latest results, the current consensus from AXT's five analysts is for revenues of US$110.8m in 2025. This would reflect a meaningful 17% increase on its revenue over the past 12 months. Earnings are expected to improve, with AXT forecast to report a statutory profit of US$0.39 per share. Before this earnings report, the analysts had been forecasting revenues of US$126.6m and earnings per share (EPS) of US$0.15 in 2025. There's been a definite change in sentiment after these results, with the analysts delivering a to next year's revenue estimates, while at the same time substantially upgrading EPS. It's almost as though the business is anticipated to reduce its focus on growth to enhance profitability.
The consensus has made no major changes to the price target of US$5.30, suggesting the forecast improvement in earnings is expected to offset the decline in revenues next year. 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 AXT, with the most bullish analyst valuing it at US$6.00 and the most bearish at US$5.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting AXT's growth to accelerate, with the forecast 13% annualised growth to the end of 2025 ranking favourably alongside historical growth of 1.2% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 18% annually. So it's clear that despite the acceleration in growth, AXT is expected to grow meaningfully slower than the industry average.