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Last week, you might have seen that Photronics, Inc. (NASDAQ:PLAB) released its quarterly result to the market. The early response was not positive, with shares down 4.2% to US$20.84 in the past week. Revenues were US$212m, approximately in line with whatthe analyst expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.68, an impressive 45% ahead of estimates. Following the result, the analyst has 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. We've gathered the most recent statutory forecasts to see whether the analyst has changed their earnings models, following these results.
View our latest analysis for Photronics
Following last week's earnings report, Photronics' single analyst are forecasting 2025 revenues to be US$874.1m, approximately in line with the last 12 months. Statutory earnings per share are expected to reduce 7.2% to US$2.16 in the same period. In the lead-up to this report, the analyst had been modelling revenues of US$915.0m and earnings per share (EPS) of US$2.10 in 2025. So it's pretty clear that while sentiment around revenues has declined following the latest results, the analyst is now more bullish on the company's earnings power.
The average price target increased 9.4% to US$35.00, with the analyst signalling that the improved earnings outlook is more important to the company's valuation than its revenue.
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 Photronics' revenue growth is expected to slow, with the forecast 1.8% annualised growth rate until the end of 2025 being well below the historical 9.8% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 16% per year. Factoring in the forecast slowdown in growth, it seems obvious that Photronics is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing here is that the analyst upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Photronics following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Yet - earnings are more important to the intrinsic value of the business. There was also a nice increase in the price target, with the analyst clearly feeling that the intrinsic value of the business is improving.