Have Analysts Changed Their Mind On The Stock?
Last week, you might have seen that AJ Bell plc (LON:AJB) released its yearly result to the market. The early response was not positive, with shares down 7.4% to UK£4.92 in the past week. Revenues of UK£317m were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at UK£0.26, missing estimates by 2.4%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Following the latest results, AJ Bell’s eleven analysts are now forecasting revenues of UK£349.6m in 2026. This would be a meaningful 10% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 5.1% to UK£0.27. Before this earnings report, the analysts had been forecasting revenues of UK£341.4m and earnings per share (EPS) of UK£0.28 in 2026. So it looks like there’s been no major change in sentiment following the latest results, although the analysts have made a modest lift to to revenue forecasts.
View our latest analysis for AJ Bell
It may not be a surprise to see thatthe analysts have reconfirmed their price target of UK£5.48, implying that the uplift in revenue is not expected to greatly contribute to AJ Bell’s valuation in the near term. That’s not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic AJ Bell analyst has a price target of UK£6.25 per share, while the most pessimistic values it at UK£4.75. This is a very narrow spread of estimates, implying either that AJ Bell is an easy company to value, or – more likely – the analysts are relying heavily on some key assumptions.
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. It’s pretty clear that there is an expectation that AJ Bell’s revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 10% growth on an annualised basis. This is compared to a historical growth rate of 20% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 0.3% annually. So it’s pretty clear that, while AJ Bell’s revenue growth is expected to slow, it’s still expected to grow faster than the industry itself.
