It's been a good week for Power Integrations, Inc. (NASDAQ:POWI) shareholders, because the company has just released its latest quarterly results, and the shares gained 5.5% to US$66.31. Revenues were US$116m, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at US$0.25, an impressive 28% ahead of estimates. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Taking into account the latest results, the consensus forecast from Power Integrations' four analysts is for revenues of US$479.5m in 2025. This reflects a decent 19% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 40% to US$0.92. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$514.0m and earnings per share (EPS) of US$1.13 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the US$78.00 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. 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. There are some variant perceptions on Power Integrations, with the most bullish analyst valuing it at US$90.00 and the most bearish at US$65.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Power Integrations' past performance and to peers in the same industry. The analysts are definitely expecting Power Integrations' growth to accelerate, with the forecast 15% annualised growth to the end of 2025 ranking favourably alongside historical growth of 0.4% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to see revenue growth of 19% annually. It seems obvious that, while the future growth outlook is brighter than the recent past, Power Integrations is expected to grow slower than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$78.00, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Power Integrations going out to 2026, and you can see them free on our platform here..

You still need to take note of risks, for example - Power Integrations has 1 warning sign we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.