FormFactor, Inc. (NASDAQ:FORM) last week reported its latest annual results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Revenues were US$663m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$1.05, an impressive 168% ahead of estimates. 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 FormFactor after the latest results.

Taking into account the latest results, the current consensus from FormFactor's nine analysts is for revenues of US$707.6m in 2024. This would reflect a modest 6.7% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to crater 50% to US$0.53 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$717.5m and earnings per share (EPS) of US$0.64 in 2024. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a real cut to EPS estimates.

The consensus price target held steady at US$42.00, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. 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 FormFactor, with the most bullish analyst valuing it at US$52.00 and the most bearish at US$35.00 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the FormFactor's past performance and to peers in the same industry. The period to the end of 2024 brings more of the same, according to the analysts, with revenue forecast to display 6.7% growth on an annualised basis. That is in line with its 5.7% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 16% per year. So although FormFactor is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for FormFactor. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that FormFactor's revenue is expected to perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on FormFactor. Long-term earnings power is much more important than next year's profits. We have forecasts for FormFactor going out to 2025, and you can see them free on our platform here.

However, before you get too enthused, we've discovered 2 warning signs for FormFactor that you should be aware of.

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