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PTC Inc. (NASDAQ:PTC) defied analyst predictions to release its second-quarter results, which were ahead of market expectations. The company beat forecasts, with revenue of US$636m, some 4.7% above estimates, and statutory earnings per share (EPS) coming in at US$1.35, 48% ahead of expectations. 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 gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the most recent consensus for PTC from 19 analysts is for revenues of US$2.50b in 2025. If met, it would imply a credible 6.4% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to ascend 16% to US$4.25. In the lead-up to this report, the analysts had been modelling revenues of US$2.49b and earnings per share (EPS) of US$3.86 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
See our latest analysis for PTC
The consensus price target was unchanged at US$186, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. 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 PTC, with the most bullish analyst valuing it at US$240 and the most bearish at US$160 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that PTC's rate of growth is expected to accelerate meaningfully, with the forecast 13% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 10% p.a. over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 13% per year. PTC is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.