The annual results for The Lottery Corporation Limited (ASX:TLC) were released last week, making it a good time to revisit its performance. Lottery reported AU$4.0b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of AU$0.19 beat expectations, being 2.4% higher than what the analysts expected. 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. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

View our latest analysis for Lottery

Following last week's earnings report, Lottery's 15 analysts are forecasting 2025 revenues to be AU$3.94b, approximately in line with the last 12 months. Statutory earnings per share are forecast to decrease 5.4% to AU$0.18 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of AU$3.96b and earnings per share (EPS) of AU$0.18 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at AU$5.34, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values Lottery at AU$6.00 per share, while the most bearish prices it at AU$4.50. This is a very narrow spread of estimates, implying either that Lottery 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. We would highlight that revenue is expected to reverse, with a forecast 1.3% annualised decline to the end of 2025. That is a notable change from historical growth of 6.6% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Lottery is expected to lag 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 Lottery. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at AU$5.34, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Lottery going out to 2027, and you can see them free on our platform here..

You should always think about risks though. Case in point, we've spotted 2 warning signs for Lottery 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.