Yahoo Finance ElringKlinger AG Just Recorded A 22% EPS Beat: Here's What Analysts Are Forecasting Next
It's been a pretty great week for ElringKlinger AG (ETR:ZIL2) shareholders, with its shares surging 14% to €6.07 in the week since its latest full-year results. It looks like a credible result overall - although revenues of €1.8b were what the analysts expected, ElringKlinger surprised by delivering a (statutory) profit of €0.62 per share, an impressive 22% above what was forecast. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Check out our latest analysis for ElringKlinger
Following last week's earnings report, ElringKlinger's six analysts are forecasting 2024 revenues to be €1.88b, approximately in line with the last 12 months. Per-share earnings are expected to grow 15% to €0.71. In the lead-up to this report, the analysts had been modelling revenues of €1.86b and earnings per share (EPS) of €0.67 in 2024. So the consensus seems to have become somewhat more optimistic on ElringKlinger's earnings potential following these results.
There's been no major changes to the consensus price target of €7.30, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on ElringKlinger, with the most bullish analyst valuing it at €12.00 and the most bearish at €4.00 per share. With such a wide range in price targets, analysts are almost certainly betting on widely divergent outcomes in the underlying business. As a result it might not be a great idea to make decisions based on the consensus price target, which is after all just an average of this wide range of estimates.
Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that ElringKlinger's revenue growth is expected to slow, with the forecast 1.7% annualised growth rate until the end of 2024 being well below the historical 2.3% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.1% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than ElringKlinger.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around ElringKlinger's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that ElringKlinger'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 said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for ElringKlinger going out to 2026, and you can see them free on our platform here..
Plus, you should also learn about the 1 warning sign we've spotted with ElringKlinger .
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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.
