It's been a good week for ACI Worldwide, Inc. (NASDAQ:ACIW) shareholders, because the company has just released its latest third-quarter results, and the shares gained 6.5% to US$60.02. It was not a great result overall. While revenues of US$427m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 13% to hit US$0.32 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the consensus forecast from ACI Worldwide's five analysts is for revenues of US$2.05b in 2027. This reflects a solid 16% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to bounce 78% to US$2.97. Before this earnings report, the analysts had been forecasting revenues of US$2.05b and earnings per share (EPS) of US$2.98 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
Check out our latest analysis for ACI Worldwide
The consensus price target rose 5.4% to US$68.00despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of ACI Worldwide's earnings by assigning a price premium. 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 ACI Worldwide, with the most bullish analyst valuing it at US$74.00 and the most bearish at US$56.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company 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. It's clear from the latest estimates that ACI Worldwide's rate of growth is expected to accelerate meaningfully, with the forecast 13% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 6.5% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 17% per year. It seems obvious that, while the future growth outlook is brighter than the recent past, ACI Worldwide is expected to grow slower than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple ACI Worldwide analysts - going out to 2028, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for ACI Worldwide you should know about.
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