Yahoo Finance Earnings Update: adesso SE (ETR:ADN1) Just Reported Its Full-Year Results And Analysts Are Updating Their Forecasts
As you might know, adesso SE (ETR:ADN1) recently reported its annual numbers. Revenues of €1.1b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at €0.49, missing estimates by 3.9%. 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.
Check out our latest analysis for adesso
Taking into account the latest results, the consensus forecast from adesso's four analysts is for revenues of €1.29b in 2024. This reflects a decent 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 656% to €3.72. Yet prior to the latest earnings, the analysts had been anticipated revenues of €1.29b and earnings per share (EPS) of €4.26 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.
It might be a surprise to learn that the consensus price target was broadly unchanged at €174, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. Currently, the most bullish analyst values adesso at €210 per share, while the most bearish prices it at €145. 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 adesso's past performance and to peers in the same industry. It's pretty clear that there is an expectation that adesso's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 13% growth on an annualised basis. This is compared to a historical growth rate of 23% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 8.8% per year. So it's pretty clear that, while adesso's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.
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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at €174, 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. We have estimates - from multiple adesso analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 1 warning sign for adesso that you need to take into consideration.
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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.
